I am considering contracting and am confused about the tax arrangements.
I am not prepared to go down the umbrella route, and would like to set up my own Ltd Company but am finding it difficult to get clear answers on the tax implications – even from my accountant. I have also consulted direct gov.
Specifically, my understanding is that for a turnover of £100,000:
Vat on flat rate scheme adds 4.5% to t/o giving total revenue of:
18900 (94500 * 20%)Corporation tax
This is where I get confused. Of the 75600 remaining, if I pay myself a salary of 13,000 and take the rest as dividends, how much total tax would I pay (including Corporation tax, PAYE and tax on dividend income)?
Thanks in advance!!!