Salary or dividend?
If you own the company, how you take money out of it changes what you keep. This compares the two routes on the same profit.
The profit
Non-domiciled individuals are exempt from Special Defence Contribution on dividends. This usually decides the answer.
Figures are for the tax year.
Taken as salary
| Income tax | |
| Social insurance | |
| GESY | |
| Employer contributions | |
| You keep |
Taken as dividend
| Corporate tax | |
| Special Defence Contribution | |
| GESY | |
| You keep |
This is an estimate, not advice. It cannot see your wider position, other income, reliefs you may be entitled to, or tax already paid elsewhere. Speak to us before deciding anything on it.
Why it is not just arithmetic
The numbers are only part of the decision. A salary builds social insurance entitlement, pension, unemployment, sickness, maternity, and a dividend does not. If you are a director with no other employment, paying yourself nothing has consequences beyond tax.
A salary is also deductible for the company, which is why the comparison is not simply one rate against another. And most owners take some of each rather than all of one.
This tool shows the extremes so you can see the shape of it. The right split for you is a conversation.