Difference between paying taxes on your salary vs on dividends

[respect]

Hey,


I have read that there are two ways to get personal money out of the company to your local country:


1. via salary (being an employee of your own company)


2. via dividends


I would like to know what would be the difference between these two in terms of taxation.


Thanks

 

[JohnLocke]

There is also by Loan agreement and Interest paid to the owner of the company. You can obtain loans in your company (which usually in most European countries are prohibited) !


If we speak personal income tax in Spain, there is no difference for you, all income will be taxed. If you have a good tax lawyer then he will be able to develop a loan agreement that actually comply to all tax laws in your country and he will be able to fight your case for you if required. So you will be able to take loans up to 10 and 20 years into the future and pay off the debt at once at this time. Also you pay your own company Interest for the money you lend. There are many ways to do things.

 

[respect]

There is also by Loan agreement and Interest paid to the owner of the company. You can obtain loans in your company (which usually in most European countries are prohibited) !
If we speak personal income tax in Spain, there is no difference for you, all income will be taxed. If you have a good tax lawyer then he will be able to develop a loan agreement that actually comply to all tax laws in your country and he will be able to fight your case for you if required. So you will be able to take loans up to 10 and 20 years into the future and pay off the debt at once at this time. Also you pay your own company Interest for the money you lend. There are many ways to do things.

Why would I need to take loans if my business does not require too many fixed costs?


I don't understand how a loan can help me to get money (for my personal expenses) out of the company.

 

[JohnLocke]

You make a loan in the company to your person! That's the key. No one in this world pay tax on loans! It's not that wasy as told here, consult a tax lawyer to help you with it. Done right it brings you huge legal tax safings!

 

[Propeller]

The loan model works pretty good and has been into full force with my company and the tax auth. here. I live in Austria at the moment.

 

[wonderwilly]

You make a loan in the company to your person! That's the key. No one in this world pay tax on loans! It's not that wasy as told here' date=' consult a tax lawyer to help you with it. Done right it brings you huge legal tax safings![/quote']
Can I ask you some question by PM in this matters please?

 

[Lecitia]

Are there rules same in most EU countries or are there any different rules?

 

[JohnLocke]

The rules are similar to each other in the EU, however, it is advsiable to consult a local and good tax lawyer and tax consultancy to help you with the setup otherwise you will quickly get into troubles since most often they will refuse to accept this type of establishments.

 

[footi gupt]

I have never heard of transferring money through dividends.
Though i am sure you can transfer the money from a foreign company to home country..

 

[myshufflemix]

As the admin said that you need to get your company a loan to yourself and then pay your loan to yourself to avoid the tax.

 

[deadpool]

Loved the loan idea. Till now I thought, salary, dividends or just anything is income and thus taxable.

 

[RamsayB]

I might try the Loan method or technique as suggested here. Its been ages since I've been paying tax as well. I need a revamp to my tax strategies