As Rrsport2020 said.

https://www.gov.uk/guidance/vat-on-motorin...%20exempt.

Then there is Notice 706 to read  2024 P550e Autobiography
2016MY TDV6 Autobiography - Gone
2011MY 5.0 SC Autobiography Black - Gone
2005 TD6 Vogue - Gone

Japseroony wrote:

there is no 50% tax bracket as the highest is 45%

I may be wrong but as of April companies will pay 25% corp tax then directors whom are in the higher rate category will pay 38.1% dividend tax making a total tax rate of 63.1%

I hope I am wrong…

You are right Rrsport2020, although the percentage I believe is slightly less.

To make the numbers simple, per £100,000

Less 25% Corporation Tax would leave you with £75,000

Then £75,000 less 38.1% tax on dividend would leave you with £46,425, so roughly 54% is what you'll pay in taxes.

Either way, it's not funny!

Not sure if that’s made me feel better or worse

Seeing the numbers like that is quite scary!

It really is depressing Rrsport2020!!

My wife has just told me that this is how we are also paid, dividend rather than salary, so it seems I'm even stupider than Jasperoony thought

I've recently told my wife that we need to cut back, try to reduce our income as much as possible in order to reduce our taxes, I'm getting fed up with it all, it's getting silly now.

This is also why I'll be selling my 2021 5.0 FFRR LWB AB which I bought new and paid cash for in December of that year. I sat down one day and worked out exactly how much I had to pay in taxes, to be left with the cash to buy this car.

Believe it or not, even with Corporation Tax at 19%, you still need to earn close to a quarter of a million pounds in company profits, to take the cash out and buy this car outright. So in short, your company needs to make almost £250,000 in profit for you to personally buy a Range Rover!!

This is exactly why I cancelled my original L460 P530 order, changing it to the P440e. This time I'm going to let the company take the loss. Anything to reduce profit and tax!

Sorry but you can’t add corporation tax/tax on dividends/income tax together and say your paying 60 odd percent tax as any dividend/income out of the company is a company expense and deducted off the company’s gross profit thereby reducing the corporation tax!

I agree the UK tax system is not fair and directors struggle to reduce the company tax but in order to pay tax you have to have the income/earnings in the first place

As for my saying VAT had anything to do with income is not what I said - VAT is both chargeable and deductible so when you buy and presumable sell either a service or product you pay VAT but then claim it back and in most cases it can offset itself.

Furthermore you can’t add income tax to dividend tax to say you pay 58-59% because you make it sound like you are paying double tax - you either pay income tax up to 45% or you pay dividend tax!

Happy to point you in the right direction chaps but some of you are suggesting you are paying tax twice and adding the rate together when income and dividends are taxed separately at their own rates "UNDERSTEER" ----is when you hit the fence with the front of the car.
"OVERSTEER" ------is when you hit the fence with the rear of the car.
"HORSEPOWER" ----is how fast you hit the fence.
"TORQUE" -----------is how far you take the fence with you.

aja500 wrote:

You are right Rrsport2020, although the percentage I believe is slightly less.

To make the numbers simple, per £100,000

Less 25% Corporation Tax would leave you with £75,000

Then £75,000 less 38.1% tax on dividend would leave you with £46,425, so roughly 54% is what you'll pay in taxes.

Either way, it's not funny!

Dividends are not a business expense and are not tax deductible.
They are paid out of profit, so the above calculations are correct. Unfortunately

Thank you Rrsport2020.

Jasperoony, as my wife and I are the only two Directors of the company we created, we are generating profit and therefore revenue in the form of corporation tax at 19%, soon to be 25% - Without my wife and I, this company and contribution would never exist, end of!

Also, if we operated as sole traders, we wouldn't have to pay corporation tax at all, so unfortunately, whether we like it or not, this is another tax on our hard work.

I've told you before Jasperoony, I'm not an accountant, but I do have a pretty good life..... Next you'll be asking me how much a pint of milk is - I don't know!

Many thanks for clarifying that the output VAT will be exempt.

The reference to the HMRC manual is particularly helpful, given some of the absolute rubbish being spouted on here.

In terms of the lease vs corporate buy option, anyone had further thoughts? With depreciation being so low, I struggle to see paying £70k over 4 years that beneficial on a lease, but a lot could change. Not least the BIK!

aja500 wrote:

Thank you Rrsport2020.

Jasperoony, as my wife and I are the only two Directors of the company we created, we are generating profit and therefore revenue in the form of corporation tax at 19%, soon to be 25% - Without my wife and I, this company and contribution would never exist, end of!

Also, if we operated as sole traders, we wouldn't have to pay corporation tax at all, so unfortunately, whether we like it or not, this is another tax on our hard work.

I've told you before Jasperoony, I'm not an accountant, but I do have a pretty good life..... Next you'll be asking me how much a pint of milk is - I don't know!

WTF you on about, milk and the cost? I never asked you anything but clearly my comments have made you go away and look things up to get a better understanding of the tax system!!

It was your/your wife's decision to go Limited not mine so I am not to blame for your tax position but don't forget it you were sole traders or an Llp then the tax man takes profit in the form of income tax and NI that can be as high as 45% plus NI

At the start of this all I did was make a tongue in cheek comment and now you are getting your panties in a twist.

The fact is for those who work hard and make a good living the government (could be worse if the other side get in) tax us to the hilt but there are some tax breaks along the way such as pensions & dividends and then some dubious "schemes" to consider - personally I stay away from the "schemes" as usually the government challenge them and win.

What you can't do is to say you pay 19% corporation tax and add that to the income tax you pay at 45% to make a tax of 64% as that is just not true! Sorry, I made a mistake on dividends but the tax rate is lower on dividends so by using your income threshold and some dividends then you are able to obtain the most out of the company in the most tax efficient way

Having said all of that, I think the average guy in the street would say we are not being taxed enough  "UNDERSTEER" ----is when you hit the fence with the front of the car.
"OVERSTEER" ------is when you hit the fence with the rear of the car.
"HORSEPOWER" ----is how fast you hit the fence.
"TORQUE" -----------is how far you take the fence with you.

please keep this thread civil... ... - .- -.




Y. O. L. O.
.

Oh jeepers Stan is in blue

English taxpayers can be glad they don't live in Scotland.

One of my friends regards expenditure as inheritance tax planning, better to spend say £150,000 on a new car than give £60,000 more to the Chancellor (if 40% is the rate). With the Scottish Govt's policy being to reduce car use by 20% by 2030 and 'net zero' and similar policies in the offing generally I believe in making the most of things while we can, and not worry too much about tax and cost, we can be glad we can afford new RRs at all. Only Range Rovers since 1988