Quote:
Originally Posted by Struggle4Bucks
But if that low salary is not enough to make a living, and you would constantly need to take more money out of the business for personal spending, then what are the tax issues? Or is it just a case of creative accounting?
|
It's the same in my country. Personal income from job is taxed higher (any bigger sums) than taking money as a dividents. Thus it is most beneficial to pay salary to itself up to break even point, and beyond that to take the money as a dividents.
So, "creative accounting" if you want to use that term, but totally legal. Idea is that you save the dividents, or pay those more often.