Quoted in the FT as the extra tax for the £8,000 salary, £31,000 dividend folks. No workings shown though.
Having reviewed the budget summary I have found the following in response to this feed
Dividend taxation – The government will abolish the Dividend Tax Credit from April 2016 and introduce a new Dividend Tax Allowance of £5,000 a year. The new rates of tax on dividend income above the allowance will be 7.5% for basic rate taxpayers, 32.5% for higher rate taxpayers and 38.1% for additional rate taxpayers.
Therefore the workings for £8000 salary £31000 dividend would be
Total income £39,000 less £16,000 (PA £11,000 & DTA £5,000) equals £23,000 @ 7.5% = £1,725 of personal tax
My answers
My thoughts
Having reviewed the budget summary I have found the following in response to this feed
Dividend taxation – The government will abolish the Dividend Tax Credit from April 2016 and introduce a new Dividend Tax Allowance of £5,000 a year. The new rates of tax on dividend income above the allowance will be 7.5% for basic rate taxpayers, 32.5% for higher rate taxpayers and 38.1% for additional rate taxpayers.
Therefore the workings for £8000 salary £31000 dividend would be
Total income £39,000 less £16,000 (PA £11,000 & DTA £5,000) equals £23,000 @ 7.5% = £1,725 of personal tax