Case Studies

Client receiving small salary plus dividends

If a client is a higher rate tax payer who is receiving a small salary and the balance as dividends, then they could consider the impact of paying a pension contribution.


  • David Ends is a director of his company – ‘Cul-de-sac Signs Ltd’.
  • He receives a gross salary of £9,000 and dividends of £50,270 .


What will be the effective rate of tax relief if David pays a gross pension contribution of 100% of his salary to a pension scheme? 

Solution = Income Tax calculator

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