½Û×ÓÊÓƵ

E1.412 Dividends etc from UK resident companies—charge to tax

Dividends (see D5.110, D5.170) and other distributions (see D5.115, D5.128) of UK resident companies are charged to income tax as savings and investment income. Such receipts are treated as income for income tax purposes even though they may be treated as capital for other purposes¹. As regards stock dividends, which are excluded from charge under this provision, see E1.420². For the taxation of dividends received by individuals, see E1.101E.

The charge also includes deemed distributions by open-ended investment companies and authorised unit trusts, as well as special purpose share schemes (see E1.413)³.

For special rules applying to shares acquired under a Schedule 2 share incentive plan, see E1.417.

The charge to tax is on the amount or value of the dividends paid or other distributions made in the tax year⁴. Before 2016/17, if the recipient was entitled to a tax credit in respect of the dividend,