How to Report Foreign Dividends and Interest in the UK

If you live in the UK and receive income from overseas investments or bank accounts, it is important to get the reporting right. Foreign dividends and foreign interest can still fall within your UK tax position, even when tax has already been deducted abroad. The good news is that the process is usually straightforward once you know which HMRC pages apply, what figures to use, and whether you can claim relief for foreign tax already paid.

For many people, the starting point is understanding that UK tax residents are generally taxed on their worldwide income. That means overseas savings interest, dividends from non-UK companies, and similar income often need to be reviewed as part of your UK tax return. Since 6 April 2025, the UK has moved to a residence-based foreign income and gains regime, replacing the old remittance basis, so internationally mobile individuals may also need to consider whether they can claim relief under the new 4-year rules.

If your affairs involve more than one tax system, this is where specialist support can make a real difference. SCC’s Cross-Border Accounting & Tax team is built around UK and Irish dual-jurisdiction expertise, while their Tax Compliance service can help keep your reporting accurate and timely.

Start with your residence and filing position

Before looking at the income itself, you need to know whether you are a UK tax resident for the relevant tax year. If you are not a UK resident, foreign income may not fall within UK tax in the same way. If you are a UK resident, HMRC will usually expect you to consider your worldwide income, including interest from overseas savings and dividends from foreign companies.

That matters even more if you have recently moved to the UK. From 6 April 2025, qualifying new arrivals who have been non-UK residents for at least 10 consecutive tax years may be able to claim the 4-year foreign income and gains regime. Where a valid claim is made, eligible foreign income and gains may not be taxed in the UK during that period.

If your position is not straightforward, About Us gives a good overview of SCC’s cross-border team and the way it supports clients across the UK and Ireland. That joined-up approach can be especially useful where personal tax reporting overlaps with business or investment structures.

What HMRC treats as foreign dividends and foreign interest

Foreign dividends usually include distributions from overseas companies and, depending on the investment, some income from non-UK funds. Foreign interest can include interest from overseas bank accounts, foreign savings products, or interest-bearing investments held outside the UK. HMRC’s Foreign notes specifically refer to interest from overseas savings and dividends from foreign companies as items commonly reported through the foreign income pages.

This is where proper categorisation matters. A dividend is not taxed in the same way as savings interest, and the allowances can be different. If you are not sure how a particular receipt should be treated, getting advice before you file is far better than correcting the return later. SCC’s Specialist Tax team can help where the tax treatment is less obvious or where overseas investment structures add complexity.

Which tax return pages should you use?

In many cases, foreign dividends and foreign interest are reported using the SA106 Foreign pages alongside your main Self Assessment return. HMRC states that SA106 is used to record foreign income and gains on your SA100 return.

There is, however, an important exception that is often overlooked. HMRC’s SA150 notes for the 2024 to 2025 tax return say that you use the Foreign pages if you received interest over £2,000 from overseas savings or dividends over £500 from foreign companies. If your only foreign income was untaxed foreign interest up to £2,000 and or foreign dividends up to £500, those amounts can be entered on the main tax return instead of using the Foreign pages.

That small detail catches a lot of people out. Some file SA106 when they do not need to, while others miss it when their foreign income has gone above the threshold. If you want to keep the process organised, SCC’s Digital Bookkeeping support can help you keep the right records during the year rather than piecing everything together at the deadline.

Use the gross amount and convert it to £ sterling

When reporting foreign dividends or interest, you generally need to work with the gross amount, not just the net figure that landed in your account after overseas tax was deducted. HMRC also expects figures on the UK return to be shown in pounds sterling, so foreign currency receipts need to be converted into £ before they are entered on the return.

A simple working paper can save a lot of time here. Keep a note of:

• the date the income was received
• the country it came from
• the gross amount
• any foreign tax deducted
• the exchange rate used
• the sterling equivalent reported on the return

That sort of record-keeping is not just good admin. It gives you a clear trail if HMRC ever asks questions. It also fits naturally with SCC’s broader SME Business Solutions approach, where better financial visibility leads to better decisions.

Do you always pay UK tax on it?

Not necessarily. Whether UK tax is due depends on your wider income position and the allowances available to you.

For dividends, HMRC says the dividend allowance is £500, and dividends above your unused Personal Allowance and dividend allowance may need to be reported and taxed at the applicable dividend rates.

For savings interest, the position can be different again. HMRC says the starting rate for savings can be up to £5,000 for some lower-income individuals, and the Personal Savings Allowance can also apply. Basic-rate taxpayers can usually receive up to £1,000 of savings interest tax-free, higher-rate taxpayers up to £500, and additional-rate taxpayers do not get a Personal Savings Allowance.

The important point is that foreign income is not ignored simply because it came from outside the UK. You still need to review it properly under UK rules.

What if tax was already deducted abroad?

This is one of the most important areas to get right. HMRC says that if foreign tax was taken off your foreign income, you may be able to claim Foreign Tax Credit Relief. The purpose is to reduce the risk of the same income being taxed twice.

That does not always mean you can claim every penny of overseas tax back against your UK liability. The amount of relief available can depend on the type of income, the relevant double tax agreement, and the amount of UK tax due on the same income. In other words, double tax relief is valuable, but it still needs to be calculated properly. This is an area where SCC’s Forensics & Investigations mindset can also be useful when records, historic deductions, or cross-border documentation need to be reconciled carefully.

Common mistakes to avoid

A few issues come up again and again:

• reporting the net amount instead of the gross figure
• forgetting to include foreign tax already suffered when claiming relief
• using the wrong exchange rate or no exchange rate record at all
• assuming small overseas amounts never need to be disclosed
• missing the change in rules from 6 April 2025 for internationally mobile individuals

If your foreign income sits alongside a company structure, wider investment planning, or succession issues, the tax reporting can link into more than just your personal tax return. In those cases, SCC’s Corporate Finance and External Audit capabilities can complement the tax advice where required.

Final thoughts

Reporting foreign dividends and interest in the UK is rarely impossible, but it does need care. You need to know whether the income belongs on the main return or the Foreign pages, whether you should report the gross amount, and whether relief is available for tax already paid overseas. If your circumstances involve recent relocation, cross-border investments, or UK and Irish tax exposure, the right advice can help you stay compliant and avoid paying more tax than necessary.

If you would like tailored support, speak to SCC through Contact Us or explore the firm’s latest updates in News & Insights. With the right guidance, you can report overseas income clearly, confidently, and correctly.

FAQs

Do I always need to complete SA106 for foreign dividends and interest?

No. HMRC’s SA150 notes say that if your only foreign income was untaxed foreign interest up to £2,000 and or foreign dividends up to £500, you can enter those amounts on the main tax return. If the foreign interest is over £2,000 or the foreign dividends are over £500, the Foreign pages are usually required.

Should I report the gross amount or the amount I actually received?

You should usually work from the gross amount, then separately consider any foreign tax deducted and whether you can claim Foreign Tax Credit Relief. Reporting only the net amount can understate the income on your return.

Can I claim relief if overseas withholding tax has already been deducted?

Often, yes. HMRC says you may be able to claim Foreign Tax Credit Relief if foreign tax was taken off your foreign income. The precise relief available depends on the circumstances and any relevant tax treaty.

What if I moved to the UK recently?

If you became a UK resident after at least 10 consecutive tax years of non-UK residence, you may be able to claim the 4-year foreign income and gains regime from 6 April 2025. If you qualify and make a claim, eligible foreign income and gains may not be taxed in the UK during that period.

Is foreign bank interest taxed differently from UK bank interest?

It is still savings income, but it may need to be disclosed through the foreign income section of the tax return. The UK tax calculation can still interact with the starting rate for savings and the Personal Savings Allowance, depending on your full income position.