Money Lesson Single

Selling up

An owner-director of 58 has four years of trading left and about £227,000 of post-tax profit a year to decide about. Take it as dividends as he goes, or leave it in and take it once when the company closes?

Company Expenses ISA Investments

Leave it in, take it at the end

3 Goals

Pay no dividends, wind the company up at 62, and take the accumulated reserve as one capital distribution.

Try this plan

Company Expenses ISA Investments

Take it as you go

3 Goals

Pay out every year's post-tax profit as a dividend, taxed at up to 39.35%, and invest what survives.

Try this plan

Leave it in, take it at the end Take it as you go

Leaving the profits in and taking them once through Business Asset Disposal Relief leaves you ~£262.4k better off than drawing them as dividends year by year.