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Home » News & Insights » Terrific Tuesday Tax Tip – Differences between Company & Sole Trader Withdrawals?

Terrific Tuesday Tax Tip – Differences between Company & Sole Trader Withdrawals?

Posted on 15th January 2021

How to withdraw funds from your organisation – Differences between Company & Sole Trader Withdrawals

This month’s theme for MJB Avanti is How To Withdraw Funds From Your Organisation, and this week we will cover Differences between Company & Sole Trader Withdrawals

Payroll is paid to employees (either a Director of a limited company or staff of either type of business) .

Drawings are when a sole trader or partner withdraw money from their business.

Dividends are a bonus paid to shareholders, (the owners of a limited company).  And can only be paid if there is profit and a positive balance sheet.

Payroll is a deductible expense, but Dividends & Drawings will not reduce your taxable profit.

MJB Avanti provide a full Payroll Bureau Service.  If you know a limited company with one or more employees and they may not be taking advantage of the allowances available please ask them to contact us.

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Filed Under: Tax tips

Disclaimer:- The information contained herein is given by way of general guidance only and no action should be taken solely on the basis of the information contained herein. The Avanti Group (UK) Ltd will be pleased to provide further guidance on the issues, and how they might affect you. No liability is accepted by the firm for any action taken without seeking appropriate professional advice

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