---
title: How Company Directors Can Pay Themselves Different Amounts Each Month (Without a Tax Headache)
description: Discover how directors of the same company can pay themselves different amounts each month fairly and tax-efficiently, without falling foul of HMRC rules.
image: https://esxr.co.uk/hubfs/250802%20Different%20Profits.webp
---

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# How Company Directors Can Pay Themselves Different Amounts Each Month (Without a Tax Headache)

![Creative business owners in the office](https://esxr.co.uk/hubfs/250802%20Different%20Profits.webp)

- August 2, 2025

![Dean Shepherd CTA FMAAT, Chartered Tax Adviser, ~30 years experience](https://esxr.co.uk/hubfs/Dean03.webp)

[Dean Shepherd CTA FMAAT, Chartered Tax Adviser, ~30 years experience](https://esxr.co.uk/blog/author/dean-shepherd)

If you run a limited company with one or more co-directors, chances are you’re not all contributing equally every single month. Maybe one of you is deep in client work while the other is taking a breather. Or perhaps your roles shift depending on what’s going on in the business.

So how do you pay yourselves fairly - **and differently from one another** - without running into tax or admin trouble?

Here’s how to do it *flexibly* and *tax efficiently* without making a mess of your accounts.

 

### The Big Idea

You don’t have to pay all directors the same amount, and you don’t have to pay the same amount every month. But you **do** need to use the right methods, or HMRC might think you’re taking shortcuts.

Let’s look at three ways you can pay yourselves differently, without losing sleep (or money) over it.

 

### Option 1: Different Dividends for Different People (Using "Alphabet Shares")

This is one of the most flexible and popular methods.

##### How it works:

- Each director owns a different “type” of share (e.g. A shares, B shares, C shares).

- You can then choose to pay different dividends (profit shares) to each person, depending on their contribution that month or quarter.

##### Why it works:

- You’re only sharing profits that already belong to the company.

- You can adjust payments to suit who did what, without affecting the others.

- Dividends are often more tax-friendly than salary.

##### But there are a few catches:

- You need the right paperwork in place (company rules, meeting notes, dividend slips).

- You need to have enough profit in the company to legally make the payments.

- If HMRC thinks you’re using this to shift income to family members just to save tax, they could challenge it.

- If you ever sell the business, some types of shares might not qualify for the lower tax rates on the sale, depending on how they're set up.

✅ **Best for**: Directors who want a clean, flexible way to reward different levels of input, especially if roles change month to month.

 

### Option 2: Everyone Gets the Same Dividend – But Some Take More Cash (Temporarily)

If you want to keep things simple - just one type of share for everyone - this option lets you handle different monthly needs without a complex setup.

##### How it works:

- You all get the same share of dividends when profits are paid out.

- If someone needs more money sooner, they can take a temporary advance—called a *director’s loan*—and it’s balanced out later when dividends are paid.

##### Why it works:

- You don’t need to mess around with different share types.

- It gives flexibility over who takes what, without affecting fairness long term.

##### Just be careful:

- These loans must be tracked properly.

- If someone takes more than their fair share and it’s not sorted within a few months after your company’s year-end, the company may owe extra tax.

- It only works if you trust each other to settle things fairly.

✅ **Best for**: Small teams who want flexibility without the admin of multiple share types, and who play fair with one another.

 

 

### Option 3: Everyone Gets a Base Salary – Then Bonuses When Deserved

If your business is doing well, and you want a straightforward way to pay more to whoever’s been busiest, this is it.

##### How it works:

- Everyone gets a regular salary through payroll.

- When someone puts in extra effort, you can pay a one-off bonus.

##### Why it works:

- Bonuses are easy to track and reward actual work done.

- No need to touch shares or profit splits.

##### Downsides:

- Bonuses are taxed like any other salary and come with National Insurance costs (for both the person and the company).

- They’re less tax efficient than dividends.

✅ **Best for**: Directors who value simplicity, or when profit levels vary too much for reliable dividends.

 

### What *Not* to Do

- Don’t just move money from the business to your personal bank account without a plan—that’s a fast track to tax and paperwork trouble.

- Don’t assume “drawings” apply to your limited company—they don’t. That’s a sole trader term.

- Don’t pay different dividends to people who own the same kind of share unless you’ve set things up properly.

### Final Thoughts

There’s no one-size-fits-all solution, and the best option depends on:

- How involved each person is

- How much flexibility you want

- Whether your company is making regular profits

- How much admin you're willing to deal with

With a bit of planning, you can reward yourselves fairly *and* stay on the right side of the tax rules.

 

 

### Need help working this out?

If you're unsure how to structure things - or want to be sure you're not triggering any unexpected tax - why not [book a meeting](https://esxr.co.uk/book-a-meeting) with us to discuss your circumstances.

---

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