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Budget 2005
Taxation of Dividends
On the gross amount1 at the rate of
- 10% for starting and basic rate taxpayers - liability covered by tax credit
- 32.5 % for higher rate taxpayers - equivalent to effective rate of 25% of dividend received2
- 32.5 % for discretionary and accumulation and maintenance trusts - equivalent to effective rate of 25% of dividend received
Shareholders are not entitled to repayment of tax credits
1 Dividend received plus tax credit
2 Unless, for 2005/2006, income does not exceed the trust standard rate band of £500
The figures shown here are subject to ammendment as the Finance Bill passes through Parliament.
This information has been prepared only as a topical guide to tax and personal financial matters. No responsibility can be accepted by us for loss occasioned to any person acting or refraining from acting as a result of any material contained in this publication.
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