Tax changes to your dividend allowance
January 9, 2018
For the current 2017/18 tax year, the first £5,000 of dividends you receive are taxed at 0%, as that amount is covered by your Dividend Allowance. This allowance will be reduced from £5,000 to £2,000 with effect from 6 April 2018. This may affect the amount of tax you pay on the dividends you receive in the 2018/19 tax year.
Where your company’s shares are held by a number of your family members, to take advantage of the Dividend Allowance, you may need to review this share structure and amend it if necessary before 6 April 2018. Changing share ownership can give rise to tax charges, so please ask us for advice before cancelling or issuing new shares.