Dividends

Dividends

Dividends And Taxation Of Shares Dividends: This is the proportion of a company's profit that is paid out to shareholders - it is normally paid out twice yearly as an interim dividend and a final dividend.  It is normally declared as an amount per share.  It is now declared as a net dividend (net of the tax credit).  ( more).  Personal Taxation: Dividend income is subject to income tax in the normal way.  

When you receive a dividend notification it will come with a 10% tax credit e.g.  If you receive a NET dividend on a share of 90p there will also be a tax credit of 10p (tax that is deemed to have been paid).  Thus making the gross dividend 100p.  You would receive a cheque for 90p.  The taxation position is slightly different for non, lower, basic and higher rate tax payers with regard to reclaim of tax or further tax liabilities.  ( more).  

Capital Gains Tax (CGT): may be payable by an investor on any gains/profit made when they sell shares.  The rate of tax is based on your total income after adding the gain to your taxable income with a taxable rate of up to 40% of the gain but there are annual capital gains allowances that you may have.  ( more)

For more advice on dividends contact us.