Home / Dividend Tax Calculator UK
Arrange a FREE Consultation Call and Let’s Discuss Your Goals!
In 2026/27, the first £500 of your dividends is tax-free under the dividend allowance, after any unused Personal Allowance. Dividends above that are taxed at 10.75% in the basic rate band, 35.75% in the higher rate band and 39.35% in the additional rate band.
If you’re a company director planning your salary and dividends, our corporate tax team can check the figures against your company’s profits.
Enter your salary and dividends below to estimate your dividend tax for 2026/27.
Calculate how much tax you may pay on dividend income in the 2026/27 UK tax year.
This calculator provides an estimate for the 2026/27 UK tax year. It does not account for every personal circumstance, allowance, relief or tax adjustment.
The calculator adds your dividends on top of your salary, applies your Personal Allowance and the £500 dividend allowance, then taxes the rest at the dividend rate for each band. It uses three details.
It then shows your estimated dividend tax, Income Tax on salary, National Insurance and take-home pay. If your dividends cross more than one band, each part is taxed at the rate for that band.
Dividend tax rates are the same across the UK. From 6 April 2026, dividends above the £500 allowance are taxed at these rates.
| Income Tax band | Dividend tax rate |
| Basic rate | 10.75% |
| Higher rate | 35.75% |
| Additional rate | 39.35% |
The dividend allowance is £500 for 2026/27. You don’t pay tax on dividends it covers.
The allowance doesn’t extend your tax bands. Those £500 of dividends still count towards your total income when working out which band applies.
| Band | Taxable income |
| Personal Allowance | Up to £12,570 |
| Basic rate | £12,571 to £50,270 |
| Higher rate | £50,271 to £125,140 |
| Additional rate | Over £125,140 |
Scottish taxpayers pay Scottish Income Tax on salary and other non-savings income. Dividends are still taxed at the UK dividend rates and bands.
| Band | Taxable income | Rate |
| Starter | £12,571 to £16,537 | 19% |
| Basic | £16,538 to £29,526 | 20% |
| Intermediate | £29,527 to £43,662 | 21% |
| Higher | £43,663 to £75,000 | 42% |
| Advanced | £75,001 to £125,140 | 45% |
| Top | Over £125,140 | 48% |
Yes. The standard Personal Allowance is £12,570 for 2026/27, and any part your salary doesn’t use covers your dividends first.
The Personal Allowance falls by £1 for every £2 of adjusted net income over £100,000. It’s withdrawn completely at £125,140.
Dividends are taxed after your other income. Your salary uses the Personal Allowance and tax bands first, and your dividends sit on top.
So a higher salary leaves less of the basic rate band for your dividends. In England, Wales and Northern Ireland, the basic rate band runs to £50,270 of total income for 2026/27.
An employee with a £29,570 salary and £3,000 of dividends pays £268.75 of dividend tax. The salary uses the Personal Allowance, £500 of dividends is tax-free and £2,500 is taxed at 10.75%, as in the GOV.UK example.
A director with a £6,708 salary and £40,000 of dividends pays £3,616.09 of dividend tax. The unused £5,862 of Personal Allowance and the £500 allowance cover £6,362 of dividends, and the remaining £33,638 is taxed at 10.75%.
Many directors take a mix of both. Salary attracts National Insurance (8% for employees between £12,570 and £50,270, and 15% for employers above £5,000), while dividends don’t, but they’re paid from profits after Corporation Tax.
A company can only pay dividends from available profits from the current and previous financial years. Our guide on how much you can pay yourself in dividends explains how to set the mix.
A dividend is a payment a company makes to its shareholders from its distributable profits. It must meet these conditions.
When we review a company’s dividends, we check for these records.
These records matter if HMRC ever asks questions.
A company should prepare a dividend voucher for each dividend. It shows that the payment was a genuine distribution of profits, not salary.
The voucher should include these details.
Keep the voucher with the board minutes showing the dividend was properly declared. Shareholders also need a copy for their personal tax records and Self Assessment tax return.
You don’t need to tell HMRC about dividends covered by your £500 allowance. Above that, how you report dividends depends on the amount.
Our personal tax services cover dividend reporting and Self Assessment for company directors.
It suits limited company directors, contractors and shareholders who want to estimate dividend tax before declaring a dividend or filing a return. Use it alongside your company’s accounts, since dividends depend on available profits.
The calculator gives an estimate based on salary, dividends and where you live. It doesn’t include these.
If any of these apply, your actual tax will differ from the estimate.
Your dividend tax depends on your total income, your leftover Personal Allowance and the £500 dividend allowance. Use the calculator for a quick estimate, then check the figures against your company’s available profits.
For a planned salary and dividend mix for 2026/27, speak to our company tax planning team.
Book a free initial consultation to plan your salary and dividends.
Dividend tax depends on your total income and tax band. For 2026/27, dividends above the £500 Dividend Allowance are taxed at 10.75%, 35.75% or 39.35%.
The first £500 of dividends is taxed at 0%, but it still uses part of your tax band.
Yes. Dividends count towards total income and can push you into higher rates.
Yes. You don’t pay tax on dividends from shares held in an ISA.
Dividend tax rates are the same across the UK. Scottish Income Tax rates only apply to your salary and other non-savings income.
Yes. Any part of your £12,570 Personal Allowance that your salary doesn’t use covers your dividends first.
No. Dividends don’t attract National Insurance, which is one reason many directors take part of their income as dividends.
