For some years now there has been a huge disparity between the rates of income tax payable when an individual shareholder extracts dividend income from a company (top effective rate currently 30.56%) compared to the rate of capital gains tax (“CGT”) payable when an individual disposes of shares or receives a capital distribution on the winding up / liquidation of a company (CGT rate 10% where Entrepreneurs’ Relief applies).

This differential between income tax and CGT rates will increase yet further on 6 April 2016 when the top rate of income tax on dividends increases to 38.1%.

To read the full update please click the link to our article.  Extraction of cash update

 

 

 

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