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A new dividend tax commences 6 April and this was the subject of a detailed newsletter a few months ago. The first £5,000 is tax free and any dividends above this are taxed at an additional 7.5%. Planning around tax year end and declaring dividends properly and 'not just taking drawings' is critical as this is likely to be an area where HMRC are aggressive. He also took the opportunity to close the final 'loophole' to manage dividend income by increasing tax on 'directors' loans to 32.5%.