Overview of Remuneration Strategies
Alternative Dividend Bonus
When
No timing restraints
Effect
- Enables discretionary bonuses to be paid in a tax efficient way with no Income Tax and National Insurance at entry.
- Sums extracted are taxed as dividends and therefore a maximum effective tax rate of 25% for higher rate taxpayers.
- Corporate Tax deductible at entry.
Use
Remuneration planning – suitable for discretionary bonus pools in excess of £1m.
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