Dividend tax question

Hoping for some quick tax guidance. A 2020 dividend was credited to the Directors loan account but we are now looking to pay out the dividend. The tax free dividend threshold has changed since 2020 and I’m finding it difficult to get clarification on which threshold (2020 or 2024) would apply?

Any help would be greatly appreciated.

As I understand, the tax rate applicable would be when the dividend was paid and not when it is drawn, in your case, the dividend was paid in 2020, so 2020 tax rate.


Thank you both. Your help is really appreciated.

Notwithstanding the distinction between interim and final, effectively the credit to the director’s loan account is payment of the dividend. When it’s a director’s dividend, the cash doesn’t have to physically be paid, it can just be added to the loan balance.

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Thanks. That’s really helpful.

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