Tips and advice: using the personal allowance in 2016–17

On 6 April 2017, the government introduced a tax-free personal savings allowance (PSA) for savings income and changed the tax-free dividend calcuations with the dividend tax allowance (DTA). This means that preparing year-end self assessments has become more complicated, says Stan Dencher FCA CTA, specialist tax writer at Wolters Kluwer

The 2016–17 tax year has seen the introduction of the £5,000 dividend nil rate, which is also known as the dividend allowance; or dividend tax allowance (DTA) and which replaces the tax credit that had previously covered the basic rate liability for dividends; and the personal savings allowance (PSA), which may be £1,000, £500 or zero.

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