WARR & CO ACCOUNTANCY BLOG
In the summer budget the Chancellor announced that from 6th April 2016 the tax credit on dividends would be replaced by a £5,000 tax free dividend allowance available to all. He went on to say that a dividend tax would also be introduced so that basic taxpayers would pay 7.5% tax, higher rate taxpayer would pay 32.5% tax, and additional rate taxpayers would pay 38.1% tax.
Tax avoidance schemes have been around for many years, but until about 20 years ago these were used by rich individuals and large companies to shelter very large sums (typically £1m +) from the taxman. They were usually designed by the very large firms of accountants with the help of senior counsel and high fees were charged to participants, often over £100k.