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HMRC internal manual

Company Taxation Manual

ACT: tax credit & FA93: stock dividends: IT treated as paid

Prior to 1993-94 when an individual, the personal representative of a deceased person or trustee of an accumulation/discretionary trust, received a stock dividend the recipient was treated as in receipt of income which had borne IT at the basic rate.

From 1993-94 onwards the recipient was treated as having received income that had borne IT at the lower rate. This kept the treatment of stock dividends in line with that applied to dividends (ICTA88/S249 (4), (5) and (6), CTM17000 onwards).