The government has confirmed a new tax hike that will affect Britons who own shares. Chancellor Jeremy Hunt today announced his plan to reduce his dividend allowance from £2,000 to £1,000 next year. Furthermore, the tax-free earnings limit will be reduced to £500 from April 2024 under existing plans. These tax changes were announced as part of Hunt’s fall budget and will primarily affect those who hold shares.
How are dividends taxed?
Investors of organizations are qualified for a dispersion of benefits, which is known as profits.No tax is required to be paid on any dividend income that falls within someone’s personal allowance, which is the amount of income an individual can earn each year without paying taxes. Taxpayers also receive a dividend benefit each year and are only paid on any income above the minimum. It should be noted that no tax is required to be paid on dividends that arise from shares in an ISA…
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