What is a tax credit on a dividend?
A dividend is normally paid net of a portion of tax, referred to as a ‘tax credit’, which is then used by the company to pay the Corporation Tax that is charged on its profits. The portion of tax credit is currently fixed at one tenth of the gross dividend. The Registrars will send you a tax voucher on behalf of the company which shows the amount of tax credit paid on each dividend. You should keep this document as the Inland Revenue may ask you for the information. If you are a lower rate tax payer, you cannot normally reclaim the tax credit but if you pay tax at the higher rate, you may have to pay a further liability. For more information on your personal tax position, you should consult a financial advisor or contact your Tax Office. The Registrars can issue a replacement tax voucher if you need one. There is no charge for a replacement requested within one month of payment. After that there is a charge of £11.75 including VAT for the first replacement and a charge of £2.35 for add
A dividend is normally paid net of a portion of tax, referred to as a ‘tax credit’, which is then used by the company to pay the Corporation Tax charged on its profits. The portion of tax credit is currently fixed at one tenth of the gross dividend. We will send you a tax voucher on behalf of the company which shows the amount of tax credit paid on each dividend. You should keep this document as HM Revenue & Customs may ask you for the information. If you are a lower rate tax payer, you cannot normally reclaim the tax credit but if you pay tax at the higher rate, you may have to pay a further liability. For more information on your personal tax position, you should consult a financial advisor or contact your Tax Office. We can issue a replacement tax voucher if you need one. A charge may be made for the re-issue of your tax voucher.
