Dividend tax calculator 2026/27

United Kingdom · 2026/27 tax year

Dividend tax rates rose by 2 percentage points from 6 April 2026. Enter your salary and dividends to see what you owe, and how it is worked out band by band.

Company directors often take a salary of £12,570
Where do you live?
Dividend tax rates are the same across the UK. Your region changes the tax on your salary.

Tax on your dividends

£0

BandDividendsTax

Dividend tax rates 2026/27

Tax band2025/262026/27
Dividend allowance£500 tax-free£500 tax-free
Basic rate (ordinary rate)8.75%10.75%
Higher rate (upper rate)33.75%35.75%
Additional rate39.35%39.35%

Dividends are added on top of your other income to decide which band they fall in. The £500 dividend allowance is tax-free, but it still uses up part of your tax band.

Example: £12,570 salary and £40,000 of dividends

The salary uses up the personal allowance. The first £500 of dividends is covered by the allowance. The next £37,200 falls in the basic band at 10.75% (£3,999). The remaining £2,300 is in the higher band at 35.75% (£822.25). Total dividend tax: £4,821.25.

Frequently asked questions

Do I need to tell HMRC about dividends?

If your dividends are within the £500 allowance, you do not need to report them. Up to £10,000 you can ask HMRC to change your tax code; above £10,000 you must complete a Self Assessment tax return.

Are dividends in an ISA taxed?

No. Dividends from shares held in an ISA or a pension are tax-free and do not use your dividend allowance.

An estimate for guidance only. It does not include savings interest or the starting rate for savings.

Last checked and updated: October 2026 (2026/27 tax year)