TaxPersonal TaxBBC stars go freelance to avoid 50% tax rate

BBC stars go freelance to avoid 50% tax rate

Celebrities set up companies to channel their earnings, saving them from paying the 50% levy on salaries over £150,000

Top talent at the BBC are classing themselves as freelancers to avoid being
hit with the 50% rate of tax being aimed at the UK’s highest earners.

Household names such as Jeremy Paxman, Fiona Bruce and Emily Maitlis have set
up companies to channel their earnings, saving them from paying the levy on
salaries over £150,000, according to
the
Daily Mail

The arrangement saves the BBC millions of pounds a year in employer’s
national insurance payments, charged at 12.8% of any salary.

Service companies pay a corporation tax of as little as 21% on their profits,
which can then be paid to the presenter as a dividend, which, in turn can be
taxed at a lower rate.

Individuals using a service company can also defer tax and make use of large
expenses allowances.

Further reading:

Taxman
on alert as footballers look to sidestep 50% rate

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