hi wondering if anyone can help.
if an employee receives a dividend from a company do they need to do a tax return themselves, even if they are receiving the dividend net of tax and they have no other income apart from their salary?
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Dividend
Hello, if they are paying the lower tax rate (ie 20%) then they do not have to pay any tax on the dividend as the tax credit covers the tax due. If they are on the higher rate of tax then there will be a tax element due and so will have to declare for self assessment.
If ...
... the employee received a notice to file a tax return, then there is an obligation to file it regardless of its content.
With kind regards
Clint Westwood
To expand on Rikos
Your dividend income is grossed up and added to other income so it is possible for the dividend to bring you into higher rate tax regardless of what rate you are paying on other income.
As always, Clint is right and you do not have a choice if you have received a notice to file.
If you have not been issued a notice to deliver you have an obligation to report to hmrc if the dividend has moved you into a higher rate tax band .