The dividend allowance was initially £5,000 but is now £2,000.
There was a lot of discussion at the time about ‘“when an allowance is not really an allowance’”. That is to say there was some confusion initially about whether dividend income within the dividend allowance was taxable income or not.
It is of course taxable income, meaning that the allowance is really a nil rate band: income within the allowance is taxable but charged at 0%. The same applies to savings income within the PSA. Income charged at 0% is not the same as income that is non- taxable.