Commenting on the cut to the dividend allowance, Andy Zanelli, Senior Technical Consultant at Ascentric, said:
“Some stars burn brightly then fade away. The dividend allowance, introduced this tax year, will be cut by 60% from April 2018, it was announced today.
“Many savers have looked to dividends for income in the current low inflation, low interest rate environment . They have adjusted their savings accordingly, only to see this latest change impose an additional tax of £225 for a basic rate taxpayer, £975 for a higher rate taxpayer and £1143 for additional rate taxpayer.
“This is another radical change to a recently introduced allowance. Savers need to think yet again about which tax wrapper and flavour of income will give them the best tax outcome.”
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Ascentric, IFDL and Fundsdirect are trading names of Investment Funds Direct Limited (IFDL).
Investment Funds Direct Limited was founded in 1982, and Fundsdirect launched as the UK’s first online fund supermarket in December 1999. Since that time, the company has built on its reputation as a leading UK fund supermarket to provide Financial Advisers with a Wrap platform under the brand name of Ascentric. It provides a full white label solution for institutional clients requiring bespoke technology and administrative services.
Ascentric is a Wrap platform, available exclusively to financial advisers and offers a fully integrated online investment management and dealing platform. It also enables advisers to transfer their clients’ assets onto a single platform to provide them with the ability to manage their client’s financial needs in just one place.