In this paper, we consider a phase-type dual model perturbed by diffusion, whose inter-claim times are continuous phase-type distributed. We derive the integral differential equation and boundary conditions for the ruin probability, and obtain the explicit expression of the ruin probability when the phase type distribution degenerates into the generalized Erlang(n) distribution. Finally, we consider a threshold dividend payment strategy in the model, and we obtain the integral differential equations for the expected dividend discount function.