The rules on dividends from HMRC are clear to UK tax payers.
You are allowed “only” the first £2,000 of dividends to be tax free, and then anything above is taxed. Dividend income in excess of the allowance is taxable at the following rates: 7.5% within the basic rate band; 32.5% within the higher rate band; and 38.1% on dividend income taxable at the additional rate
So what is £2,000 tax free dividends worth if you held some high quality UK stocks.
e.g the world’s leading Telecommunications corporation is BT plc. www.bt.com
https://www.btplc.com/Sharesandperformance/Dividends/Dividends.htm
In the tax year 2017-18 BT paid 2 dividends:
4.85p in 5th Feb 2018
10.55p in 4th Sept 2017
4.85p + 10.55p = 15.4p
So to have £2,000 dividend income in 2017-18 from BT you would need: £2,000 / £0.154 = 12987.01298701299 Shares in BT plc.
at today’s market price of £2.35
http://www.shareshop.hsbc.co.uk/shareshop/security.cgi?csi=10025&action=
That would mean an investment of £2.35 * 12987.01298701299 = £30519.48051948052
Thus £30,519 buying BT shares today would give an approximate income of £2,000 if all things being equal (share price steady, dividend payment steady). BT Be There.
If you wanted £2,000 income in an oil company like Royal Dutch Shell plc, what would that be ?
Shell pays out 4 dividends a year
https://www.shell.com/investors/dividend-information/historical-dividend-payments.html
It is has remained steady at US$0.47 a share which is about 33p a share.
Thus 4 dividends:-
33p+33p+33p+33p = £1.32
So to have £2,000 dividend income in 2017-18 from Royal Dutch Shell B shares you would need: £2,000 / £1.32 = 1515.151515151515 Shares in Royal Dutch Shell B plc.
at today’s market price of £23.71
http://www.shareshop.hsbc.co.uk/shareshop/security.cgi?csi=133755
That would mean an investment of £23.71 * 1515.151515151515 = £35924.24242424242
Thus £35,924 buying shares in Royal Dutch Shell B would give today would give an approximate income of £2,000 if all things being equal (share price steady, dividend payment steady)