Sarah Bradford highlights options for extracting company profits in a tax-efficient manner in 2024.
If you operate your business through a personal or family company, you will need to extract your profits if you want to use them to meet personal expenses outside the company. There are various ways this can be done, some of which are more tax-efficient than others.
As the end of the 2023/24 tax year approaches, it is not sufficient just to consider how to extract profits; it is also necessary to consider when – is it better to take more out before the end of the 2023/24 tax year, or wait until the start of 2024/25?
It should be noted at the outset that there is no ‘one-size-fits-all’ – the optimal strategy is the one that works best for you. It may be that you can pay less tax if you wait until 2024/25 before extracting further profits, but if you have large personal bills to pay