That total is nearly double the level seen just two years earlier, driven by successive reductions to the dividend tax-free allowance.
The threshold was cut from £2,000 to £1,000 in April 2023, and then halved again to £500 in April 2024. HMRC data indicates these changes have significantly broadened the reach of the tax. After holding steady for several years, the number of dividend taxpayers climbed from 1.9 million in 2022/23 to an estimated 3.08 million in 2023/24, before rising again to a projected 3.665 million in 2024/25 — the most recent year for which HMRC has produced estimates.
| Tax year | Number of individuals paying dividend tax |
| 2020/21 | 1,810,000 |
| 2021/22 | 1,830,000 |
| 2022/23 | 1,900,000 |
| 2023/24 (est) | 3,080,000 |
| 2024/25 (est) | 3,665,000 |
When the cuts were first unveiled, HMRC projected that 635,000 more people would start paying dividend tax in 2023/24, with a further 1.115 million affected in 2024/25. Updated modelling, using more recent income data, now puts those increases at 865,000 and 480,000 respectively — still adding up to more than 1.3 million extra taxpayers over the two years.