Interest paid on bank accounts is taxed at 20% before it is credited to your account. However,if you pay tax at 40% or from 2010/11 the new additional rate of 50% you will be liable to pay an additional 20% or 30% respectively, on the gross interest received.

You can register for the tax to be paid in full without the deduction of income tax. Just ask your bank or building society for form R85.

If you pay tax at the higher rate or from 2010/11 at the additional rate, you will be liable to tax at 32.5% or 42.5% respectively, on the gross dividend. However, each dividend carries a 10% notional tax credit which will be offset against the additional liability.

As you held at least 5% of the ordinary voting shares and were a director of the company for one year up to the date of sale, entrepreneurs' relief should apply. Although the conditions for entrepreneurs' relief refer to ordinary voting shares, the gains arising on both the ordinary shares and preference shares can be included in your claim for entrepreneurs' relief. If the sale was concluded between 6 April 2010 and 22 June 2010 the maximum gain that could be covered by entrepreneurs' relief is £2 million, for sales between 23 June 2010 and 5 April 2011 the maximum gain that could be subject to an entrepreneurs' relief claim was increased to £5 million and for sales from 6 April 2011 the maximum gain that can be subject to an entrepreneurs' relief claim has increased to £10 million.