For the definition of stock dividends, see ¶328-132.

Where stock dividends are issued to individuals, trustees of accumulation and maintenance or discretionary settlements or personal representatives prior to 6 April 2016, income is treated as arising to those recipients equal to the ‘cash equivalent’ of the stock received grossed up by reference to the dividend ordinary rate (ITTOIA 2005, s. 410, 411 prior to amendment). The date on which that income is deemed to arise is the earliest date on which the company is required to issue the share capital (ITTOIA 2005, s. 410(6)).

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