Entrepreneurs: time to plan for the 2024 dividend before it’s too late
Updated: 8 november 2024, 13:51Published: 5 november 2024, 09:31
Do you run a limited company that will turn a profit in 2024? Then you know for sure that you will be able to withdraw a low-taxed dividend next year. How high that dividend will be depends, of course, on the year’s results in the first place, but also on how you plan your salary withdrawal before the end of this year. In other words, it is high time to plan for your K10. The automated accounting service Wint gives you the tips you need.
As the year draws to a close, many who run AB start thinking about their K10, i.e. the form that most owners of limited liability companies must use as an attachment to their private income tax return.
The K10 controls how much you can take out in low-tax dividends next year. But to maximize it, you need to act before the turn of the year. Anders Nilsson, tax expert at the automated accounting service Winthas a solid grasp of what applies.
– The share dividend is one of the main advantages of running AB. It gives you as an owner the opportunity to plan your total annual income in a way that makes it extra financially beneficial for you as a private person. The dividend is only taxed at 20% up to a certain threshold amount, which is a big difference to the tax rate on the regular salary, says Anders.
Two rules govern how high a dividend you can receive
And it is precisely income planning that is especially relevant now that the year is almost over. How high your limit amount for low-tax dividends is this year is calculated based on two different rules, the simplification rule or the main rule.
– If you use the simplification rule, you actually start from a standard amount (in 2025 this is SEK 209,550) which is the same for all limited companies, but if you want the opportunity to maximize your dividend, that is the main rule that applies. And it takes into account the total salary you took out of the company during 2024, says Anders, who will shortly be holding a webinar on the subject of “Right salary” and K10.
Don’t miss our webinar: How to maximize the 2024 dividend from your AB
But Anders also believes that there are more parameters to take into account when planning your income than just the distribution space. The salary you take out of the company determines, for example, how much income tax you need to pay or what social security cover you get.
– In 2024, you can withdraw an annual salary of a maximum of SEK 615,300 – or SEK 51,275/month – to pay municipal income tax alone. Every kroner over that amount is taxed with an additional 20% in state income tax in addition to the municipal tax, Anders says and continues:
– Therefore, many business owners choose to set a maximum ceiling on their monthly salary just below the limit for state tax, in order to instead take out an extra lump sum in dividends and increase their total income from the company that way.
Also read: How Wint works in the entrepreneur’s everyday life
Review your payroll before the end of the year
If you collect such a high salary, you have also secured maximum social security protection in the form of SGI and pension.
You who take out SEK 573,000 or more in 2024 have reached the highest sickness benefit qualifying income, and you who take a salary of at least SEK 614,934 this year have also maxed out your pension qualifying income. Two things that can be good to have with you if the salary you have collected so far is just below one of those limits.
– It is the total annual salary that matters in this context, so if you calculate it and realize that you need to take out a higher salary in December in order for this year’s salary to exceed a certain threshold amount, then it is perfectly fine to do so if the company has the finances to do so, says Anders.
“Right salary” this year is decisive for your dividend next year
And an extra salary withdrawal in December, yes, that can very well also be relevant if you want to maximize your distribution space. As previously mentioned, the main rule for your distribution space in 2025 is based on your salary withdrawal and the total amount of salary paid by the company in 2024, as well as a couple of other parameters.
– You therefore need to calculate which salary is the “right salary” for you and then make sure to have taken out exactly that amount in salary before the end of the year. The calculation easily becomes quite complicated, so we at Wint have developed the site K10.nu which you can use to calculate your distribution space, advises Anders.
2024 is perhaps the last year that we will have to count on the salary requirement to be able to use the salary base. Namely, a new investigation has been submitted to the government, the so-called 3:12 investigation. We will only know exactly what will apply when it becomes law in 2025.
Also read: How Wint can automate your business
Om Wint
Wint is a full-service service for company accounting and administration. Wint wants to make it easy to be an entrepreneur by automating most of the hard things about running a company. In this way, time is freed up that can be spent on more business-critical parts of the business – such as developing one’s business. Wint’s customers pay a fixed monthly cost for the entire service, which includes everything from ongoing bookkeeping and payroll processing to financial statements and advice.
Do you want to know more? Take a look at wint.se.
The article is produced by Brand Studio in collaboration with Wint and not an article by Dagens industri
