Dividends taxed at source... with the "source" being the UK

mouthwatering

I had shares of a UK company in an offshore acct with four div'd payments for tax year 2024/25 (they're now sold ). Let's say these four payments add up to £1000 and furthermore that £200 (ie 20%) of that was tax paid at source, the source being the UK. I know that I have to give the £1000, not the £800 I actually received, as dividend income on the foreign pages, SA106. But I'm rather unclear about what to do about the £200 kept as tax at source, ie already paid in the UK.

I do not think a DTA comes into play here as I'm tax resident in the UK only and the div'd were taxed in the UK only but this may be nonsense. If it's nonsense then I'll have to dig up the relevant DTA.

I do think these £200 should be a sort of tax credit (since I've paid it) but I'm not at all clear whether and how I can put this for SA. I assume it's also in the SA foreign pages: on page F2 there's "Dividends from foreign companies", and field B would be £1000. Field C is 0 because no foreign tax was taken? And field D is £200 as that's the amount taxed at source by the UK? If that's right will I then get the £200 credited to my tax payable or do I have to do something else/differently?

Thank you for enlightening a very puzzled tax payer.

eskbanker

Why would tax have been deducted from a UK dividend payment in the first place, and why at 20%?

https://www.gov.uk/tax-on-dividends

wmb194

mouthwatering said:

I had shares of a UK company in an offshore acct with four div'd payments for tax year 2024/25 (they're now sold ). Let's say these four payments add up to £1000 and furthermore that £200 (ie 20%) of that was tax paid at source, the source being the UK. I know that I have to give the £1000, not the £800 I actually received, as dividend income on the foreign pages, SA106. But I'm rather unclear about what to do about the £200 kept as tax at source, ie already paid in the UK.

I do not think a DTA comes into play here as I'm tax resident in the UK only and the div'd were taxed in the UK only but this may be nonsense. If it's nonsense then I'll have to dig up the relevant DTA.

I do think these £200 should be a sort of tax credit (since I've paid it) but I'm not at all clear whether and how I can put this for SA. I assume it's also in the SA foreign pages: on page F2 there's "Dividends from foreign companies", and field B would be £1000. Field C is 0 because no foreign tax was taken? And field D is £200 as that's the amount taxed at source by the UK? If that's right will I then get the £200 credited to my tax payable or do I have to do something else/differently?

Thank you for enlightening a very puzzled tax payer.

Which company? Are you certain it isn't domiciled abroad? The only UK tax taken at source of 20% on "dividends" is actually not on a dividend but a PID (Property Income Distribution) paid by REITs e.g., British Land, Land Securities. 

If so, you enter this as other income, not dividend income, and declare the withheld tax in that section.