The dividend tax threshold is also changing in April 2023, meaning that you’ll owe tax on any dividend income over £1,000 and £500 from April 2024, whereas the current tax-free threshold is £2,000.

This means someone with dividend income of £3,000 per year will pay £675 dividend tax next tax year compared with £337 this tax year. From April 2024, they will owe an even higher £843 dividend tax on their earnings.