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Dividend Tax Calculator UK

Dividends are taxed after your other income, using the £500 dividend allowance and then dividend rates. From April 2026 the ordinary rate is 10.75% and the upper rate 35.75%.

Tax year 2026/27 · Estimates, not personal tax advice

£
£

Dividends are taxed on top of this

Dividend tax

£3,171.25

Effective rate on dividends: 10.6%
Dividend allowance (0%) on £500£0.00
Dividend ordinary rate (10.75%) on £29,500£3,171.25
Total dividend tax£3,171.25
Income Tax on salary£0.00

2026/27 rates: 10.75%, 35.75% and 39.35%, with a £500 allowance. Dividends in ISAs and pensions are tax-free.

Rates and rules used

Tax year 2026/27

Default year 2026/27 (6 April to 5 April). 2025/26 and 2024/25 figures are kept for comparison where the calculator offers a year choice.

Independent site, not affiliated with HMRC. Always check GOV.UK for the latest figures.

How this calculation works

  1. 01Apply the Personal Allowance to salary first, then any remainder to dividends.
  2. 02Tax the first £500 of dividends at 0%, using up band space.
  3. 03Tax remaining dividends at the rate for the band they fall in.

Real payroll can differ because tax and NI are worked out per pay period, and your tax code may include adjustments HMRC hasn't told you about. See our methodology.

Why salary matters

Dividends sit on top of salary and self-employed profit. If your salary already uses the basic rate band, every dividend pound above the allowance is taxed at the upper rate. The allowance itself still uses up band space.

Understanding your dividend tax calculator result

Dividends are stacked above salary and other income, so the same dividend can cross more than one band. The result allocates the taxable amount after the dividend allowance to the available bands.

Planning a company dividend

Scenario: Enter salary and other taxable income first, then the proposed dividend. Compare several dividend amounts around the remaining basic-rate band.

How to use the result: The breakdown shows which portion uses each dividend rate. Remember that Corporation Tax is paid by the company before profit is available for distribution.

Details to check before relying on the estimate

  • Use dividends actually declared, not informal drawings.
  • Include dividends from investments outside ISAs and pensions.
  • The allowance reduces tax but still occupies tax-band space.

Putting the estimate into perspective

Keep personal dividend tax separate from the company's tax and cash position. The estimate does not establish that the company has profit legally available to distribute.

Frequently asked questions

Are dividends in an ISA taxed?

No. Dividends inside an ISA or pension are tax-free and don't use your allowance.

Check it on GOV.UK: Tax on dividends (opens GOV.UK in a new tab)

Do Scottish taxpayers pay different dividend tax?

No. Dividend tax uses UK rates and bands everywhere.

Check it on GOV.UK: Scottish Income Tax (opens GOV.UK in a new tab) · Tax on dividends (opens GOV.UK in a new tab)

What decides my dividend tax rate?

Dividend rates depend on your total taxable income. The part of a dividend that falls in each band is taxed at that band's dividend rate after your dividend allowance is used.

Check it on GOV.UK: Tax on dividends (opens GOV.UK in a new tab)

Do I need to report dividends?

You may need to report them on a Self Assessment return if they exceed the allowance or push you into a higher band. Check GOV.UK to see whether the rules apply to you.

Check it on GOV.UK: Tax on dividends (opens GOV.UK in a new tab)

Related calculators

Related guides

  • Dividend Tax Explained — How dividends are taxed in 2026/27 after the rates rose to 10.
  • UK Tax-Free Allowances — A summary of UK tax-free allowances for 2026/27: Personal Allowance, savings, dividends, CGT, trading, property, ISAs and pensions.