In this guide
Salary through payroll
Salary is normally processed through PAYE. The company records the cost, calculates payroll deductions and considers employer National Insurance where applicable.
Dividends from profits
Dividends are paid to shareholders from available distributable profits. They require company approval and proper supporting records.
How should the options be compared?
Review company profit, employment duties, tax bands, National Insurance, pension position, cash flow and the need for a regular payment. A comparison should use current figures for the correct tax year.
Official sources
Rates and deadlines can change. Use these links to check a rate, deadline or eligibility rule.
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