DIVIDEND WITHHOLDING TAX

A Sunday Times reader asks personal finance expert Jill Kerby if he is liable for tax on dividends earned from shares in the UK, which have already been taxed there.

Ms Kerby advises that tax is liable here, as the share dividend is treated as income. Any UK tax already paid is not refundable.

“Because the UK tax is non-refundable, top-rate taxpayers need to pick and choose shares carefully, concentrating on those likely to generate capital gains rather than income,” Kerby advises.