PTC - Tax credit on dividends

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carla030698
carla030698 Registered Posts: 112 Dedicated contributor 🦉
in AAT Level 4 (Level 8 in Scotland)
Hi,

I am doing the homestudy course with BPP for PTC and dont understand when to calculate the tax credit on dividend income, can anyone help???? :confused1:

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  • burg
    burg Registered, Moderator Posts: 1,441 mod
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    The dividend income needs to go into the tax computation as gross.

    Often you will be given the amount as received.

    You will then need to gross it up by /90 x 100

    Gross dividend - net dividend = tax credit

    This can then be offset against the tax calculated as due, in the same way as tax deducted through PAYE and bank interest received.

    Example

    Dividend received £90

    So £90/90 x 100 = £100

    Tax credit = £100 - £90 = £10

    Hope this helps
    Regards,

    Burg
  • carla030698
    carla030698 Registered Posts: 112 Dedicated contributor 🦉
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    Thats great thanks! It seems easy now I know how!
    Maybe it was all the numbers and the chattering of the family in the background getting all too much! The joys of homestudy! :laugh:

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