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Changes to Dividend tax 

The Chancellor has announced that from 6 April 2016 there will no longer be a notional tax credit associated with dividends received and the following rates will apply after a £5,000 tax free dividend allowance:

  • Basic rate taxpayers                 7 ½%
  • Higher rate taxpayers              32 ½%
  • Additional rate taxpayers       38.1%

This will mean that from 2016/17 individuals will be able to receive up to £17,000 tax free:

  • Personal allowance            £11,000
  • Tax free interest                   £1,000
  • Tax free dividends               £5,000

The changes will mean that many people will pay more tax from 6th April 2016, for detailed explanations see my recent blog – here

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