Tax Accountant in Surrey

Affordable fixed fee personal tax packages. Covering tax returns, self employed & rental accounts, bookkeeping and complex tax affairs. Making tax as easy as possible for clients since 2006.

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Dividend Tax Increase from April 2022

The rate of tax on dividend income is to increase from April 2022.

At present, there is also a £2,000 annual tax-free allowance for dividend income.

There have been no changes announced to this annual limit, however the rate of tax that is charged on dividends above the annual limit is to increase:

Income BandCurrent Tax RateTax Rate from April 22Percentage Rate Increase
Basic Rate7.5%8.75%17%
Higher Rate32.5%33.75%3.9%
Additional Rate38.1%39.35%3.2%

You can see from the table above that there appears to be a much higher percentage increase in the tax rate to those within the basic rate band of tax. However the actual amount paid in extra tax remains the same for all three tax band groups.

An example, assuming someone receives £10,000 of dividend income pa (£8,000 taxable):

Income BandCurrent Tax RatesTax Rates from April 22Tax Paid Increase
Basic Rate£600£700£100
Higher Rate£2600£2700£100
Additional Rate£3048£3148£100

The last time the dividend tax rates changed, some company owners were able to take dividends earlier so that they fell in the year of the original rate. For those with professional investments, perhaps taking dividends as their retirement income, this option isn’t available.

For investments held within an ISA account, the dividend income isn’t taxable.

September 17, 2021

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Accountant in Surrey

Are you looking for a personal tax specialist?

I built up my tax experience in industry and practice over 17 years before founding my own practice in 2006.

Based in Cobham, Surrey I can also help clients throughout the UK.

  

My goal is to make personal tax and accounts for the self-employed as easy as possible for clients

 

Award-winning Accountant

Small Business Saturday is the UK's most successful small business campaign. Only one hundred of the UK’s top small businesses are selected each year for the SBS100. They act as trail-blazers in the official count-down towards the annual event.

I was one of the alumni from the 2014 Small Business Saturday 100, resulting in two visits to Downing Street.

In the Surrey Digital Awards from 2015 - 2018, I was also the winner of several top awards.

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