Our dividends are normally paid twice a year, with final dividends paid in September, and interim dividends in February. Shareholders who have dividends paid direct to bank or building society accounts are sent one consolidated dividend confirmation with our annual mailing in May, giving them all their BT dividend information for the previous year in one statement.
Withdrawal of cheque dividend payments
From September 2022, payments to shareholders are longer made by cheque. To continue to receive BT Group plc dividends and any other money payable to you in connection with your BT Group plc shares, you must take action and provide your bank or building society account details so that payments can be made directly to your nominated account.
If you do not provide your bank or building society account details, your dividend payments will be retained until your bank details are received, after which payment will be credited to your account as soon as possible. Your dividends will not accrue interest while they are being held for you and there may be a fee for Equiniti to reissue payments.
Further information on dividends
Dividends are the share of a company’s profits that it decides to pay to its shareholders, on which they have already paid - or are due to pay - tax. They are an important part of the return from investing in shares, in addition to any increase in the share price. Companies are under no obligation to pay dividends, but they usually choose to do so because dividends provide an incentive to invest in their shares.
Companies typically keep part of their profits back to expand the business and/or increase their reserves, and will then pay out the rest as a dividend. If companies have good investment opportunities, they will tend to keep more of their profits back for this purpose, reducing the amount available for dividends. So the amount of profit companies make and the alternative uses of its profits will help to determine the dividend.
Dividends are usually paid after the half-year and full-year financial results, although some companies pay quarterly. At this time, a company’s board of directors will decide how much to pay per share. At the same time, the ex-dividend date, the record date and the payment date will be announced. The shares entitle the holder to receive a dividend up to the ex-dividend date. (The share price will fall by the amount of the dividend after this date: the shares ‘go ex-dividend’.) The record date is when the company registrar determines who is entitled to receive the dividend: the ‘beneficial owner’. The payment date is the date on which payment of the dividend is made to the beneficial owner.
Dividend and UK income tax
You can find information about paying UK tax on dividend income, including the rules before April 2016 on HM Revenue & Customs website.
From April 2016
In April 2016 the dividend tax credit was replaced by a tax-free dividend allowance. The dividend allowance doesn’t reduce your total income for tax purposes, but it means that you won’t have to pay tax on the first £2,000 of your dividend income, no matter what non-dividend income you have. The allowance is available to anyone who has dividend income.
The allowance reduced to £2,000 (from £5,000) in April 2018.
What does this mean for you as a shareholder?
Tax on any dividends you receive over £2,000 is payable at the following rates:
- 8.75% on dividend income within the basic rate band
- 33.75% on dividend income within the higher rate band
- 39.35% on dividend income within the additional rate band
Dividends within your allowance will still count towards your basic or higher rate bands, and may therefore affect the rate of tax that you pay on dividends you receive in excess of the dividend allowance.
Dividends received on shares held in an Individual Savings Account (ISA) continue to be tax free.