How earnings work on a limited company
Summary
Firstly, you are an employee of the Limited Company and as such are usually paid a regular salary which may be subject to tax and national insurance depending on how much this is. This blog is available on AccountingWeb here: This salary is then treated as a company expenses and along with any other allowable expenses is deducted from your total income (Turnover) to give a Net Profit or Loss. Corporation tax is payable nine months and one day after your year end. So if your year end is 31st December 2018 then you will need to pay your Corporation tax by 1st October 2019. Important note: It is always best practice to seek advise from HMRC or your tax advisor to ensure that all expenses you are claiming are allowable and that you have set up your regular salary and dividend payments in the most tax efficient manner.
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