In calculating how much dividend I can take out of my company do I need to add back deferred tax and then use what's left for dividends.
Or can I ignore deferred tax and take out more in way of dividends?
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No, the very objective of deferred tax being there is to restrict the distributable surplus!!
Yes, so assuming there is no brought forwarded losses (for company law purposes) the maximum that you could distribute is £7.5k
Slight correction
Yes, so assuming there is no brought forwarded losses (for company law purposes) the maximum that you could distribute is £7.5k
Plus any retained profits from previous years.
Tax loss
If in my tax comp I use all the AIA (£25k) this creates a negative figure of (£10.5) in my tax comp
To recap:
Profit for year £12k
Add back dep'n £2.5k
Less AIA £25k
Equals (£10.5k)
Is this a trading loss I can carry forward?
That's a TAX loss that you can firstly carry back against any taxable profits in the previous year. Failing that you carry it forward against future profits from the same trade.
Tax loss = Pottential deferred tax asset
If you have a tax loss to carry forward then you may have a deferred tax asset? It seems to me on the surface the loss is as much a timing issue as the accelerated capital allowances.
The criteria for recognition is more stringent but if the underlying company is profitable going forward its an option.
netting deferred tax
You've included the ' accelerated capital allowances' element of the deferred tax provision, however (in expectation of future taxable profits) you could/should also recognise an asset of 10,500 @ 20% = 2,100
This increases your distributable profits to £9,600
(effectively this is your £12k pre tax profit, less a 20% tax charge)