A gilt goes ex-dividend a week before each coupon, and from that day a buyer no longer receives the next payment, which is why the accrued interest on the row turns negative.
The week before a coupon
For most of the six months between coupons, a buyer of a conventional gilt takes over the interest that has built up since the last payment and receives the whole of the next coupon. For the last week or so of the period that stops being true. The gilt goes ex-dividend, and a buyer who settles on or after that date does not receive the next coupon at all — the seller does, because the seller held the gilt when the entitlement was fixed.
The market convention, reflected in the Debt Management Office's gilts-in-issue data, is that a coupon goes ex-dividend seven London business days before its payment date, with England and Wales bank holidays excluded. The DMO publishes the next ex-dividend date for each gilt; the site applies the same seven-business-day rule to every later coupon, so the window is a property of the coupon rather than a figure copied per gilt.
Why the accrued interest turns negative
Accrued interest is normally the portion of the next coupon the seller has earned by holding the gilt up to settlement. Inside the window the buyer will not receive that coupon, so there is nothing for the buyer to be reimbursed for. The convention is to reverse the figure rather than set it to zero: the accrued interest is quoted as a negative amount, equal to the interest that would have run from settlement to the payment date, and the dirty price is the clean price plus that negative number.
The effect is that the dirty price sits below the clean price for a few days, which is the opposite of the ordinary case. It is not a discount and not a defect in the row. The price the market quotes in the window is an ex-dividend price, lower than it would be with the coupon still attached, and the negative accrued is the second half of the same adjustment: the buyer pays less because the buyer receives less.
A negative accrued interest is the row saying the next coupon is not yours. The same money is reflected in the price, so the gilt is not cheaper in any settled sense — it comes without the payment that is about to be made.
What the day count means in the window
The day count beside the accrued figure still runs forward from the last coupon date, so it keeps growing through the window and reaches nearly the whole period by the payment date. That is deliberate: the count answers how far through the coupon period the settlement sits, and that fact does not change when the entitlement does. What changes is the sign of the pounds figure, because the interest that has accrued is no longer owed to the buyer.
So a row inside the window reads as a large day count beside a small negative amount. The two halves are answering different questions — how far through the period, and who gets the coupon — and a reader who takes the day count as a measure of the pounds will find the sign impossible to explain.
The arithmetic, on stated inputs
The size of the negative figure is the half-yearly coupon multiplied by the days from settlement to the coupon and divided by the days in the period. Take an illustrative gilt with an annual coupon of 4.00, so the half-yearly payment is 2.00 per £100 nominal, in a period of 182 days, and suppose settlement falls five days before the coupon date. The negative accrued is 2.00 multiplied by 5 and divided by 182, which is about 0.055 per £100 nominal. Against a clean price of 101.20, the dirty price is 101.20 less 0.055, or about 101.145.
| Input or figure | Value | Note |
| Annual coupon | 4.00 per £100 | Illustrative gilt terms |
| Half-yearly coupon | 2.00 | Half the annual rate |
| Days in the period | 182 | Previous coupon to next coupon |
| Settlement to coupon | 5 days | Inside the ex-dividend window |
| Accrued interest | −0.055 | 2.00 × 5 ÷ 182, signed negative |
| Clean price | 101.20 | Illustrative ex-dividend price |
| Dirty price | 101.145 | Clean price plus the negative accrued |
Every figure in the table is an illustration with its inputs stated, not a quote from any gilt. The exact negative figure on a row comes from the site's calculation against the gilt's own coupon schedule, and the calculation removes the forgone coupon from the flows the buyer is valued on, so the yield is solved on the payments a buyer in the window actually receives.
Where to see it
On the conventional gilts list a gilt inside its window shows the negative figure in the accrued column, and the dirty price sits below the clean price beside it. The income calendar names the ex-dividend dates as events in their own right, alongside the coupons and redemptions, so a reader can see which gilts are approaching a window rather than discovering the sign change on the list.
The two views answer different questions. The calendar is forward-looking: it lists the dates on which entitlements change. The list is a snapshot of the current settlement, and it shows the consequence — the negative accrued and the lower dirty price. Reading them together explains why a gilt can look cheaper for a week and then look dearer again the day after the coupon, without any market move at all.
Background, not advice
This article explains why accrued interest is negative in the ex-dividend window; it is general background, not investment, tax or legal advice for any reader's circumstances. The figures above are illustrative, and the gilt's own record, the Debt Management Office's gilts-in-issue data and the day's market data are the primary sources for a real coupon date, ex-dividend date or accrued figure. A price read inside the window is not comparable with one read outside it without allowing for the coupon in between.