Dividend Tax Calculator 2026/27

Calculate how much dividend tax you owe as a Ltd company director, investor or shareholder. Includes the £500 dividend allowance and all 2026/27 tax bands.

Dividend Tax Owed
£0.00
Effective rate: 0.00%
Dividend Breakdown
Gross Dividends
£0.00
Tax-Free Allowance
£500.00
Taxable Dividends
£0.00
Basic Rate Tax (8.75%)
£0.00
on £0.00
Higher Rate Tax (33.75%)
£0.00
on £0.00
Additional Rate Tax (39.35%)
£0.00
on £0.00
Enter your details to see your dividend tax breakdown.
Dividend Breakdown Chart
2026/27 Dividend Tax Rates
Band Taxable Income Range Dividend Tax Rate
Dividend Allowance First £500 of dividends 0% (tax-free)
Basic Rate Up to £50,270 total income 8.75%
Higher Rate £50,271 – £125,140 33.75%
Additional Rate Above £125,140 39.35%

Scottish taxpayers: dividend income is always taxed at UK (not Scottish) rates, regardless of where you live. The personal allowance tapers by £1 for every £2 earned above £100,000, reaching zero at £125,140.

Dividend Tax · How Much Will You Pay? 2026/27

First £500 of dividends is tax-free. Rates: 8.75% basic · 33.75% higher · 39.35% additional. Dividends sit on top of other income.

Dividend Amount Basic Rate Tax (8.75%) Higher Rate Tax (33.75%) Additional Rate (39.35%)
£500£0 (within allowance)£0 (within allowance)£0 (within allowance)
£2,000£131£506£591
£5,000£394£1,519£1,773
£10,000£831£3,206£3,741
£20,000£1,706£6,581£7,678
£30,000£2,581£9,956£11,616
£50,000£4,331£16,706£19,491

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Dividend Tax Calculator FAQs

How much tax do I pay on dividends UK 2026?
Dividend tax rates in 2026/27 are: 8.75% (basic rate) · 33.75% (higher rate) · 39.35% (additional rate). The first £500 of dividends per year is tax-free under the dividend allowance. Dividends are always taxed on top of your other income, so your tax band depends on your total earnings.
What is the dividend allowance for 2026/27?
The dividend allowance is £500 in 2026/27 · reduced from £2,000 in 2022/23 and £1,000 in 2023/24. The first £500 of dividend income is tax-free regardless of your tax band. Above £500, dividends are taxed at 8.75%, 33.75% or 39.35% depending on your total income.
Is it better to take salary or dividends from a limited company?
Most director-shareholders take a small salary up to the NI threshold (around £12,570) and draw the remainder as dividends. Dividends carry no National Insurance and attract lower tax rates than salary · 8.75% vs 20% in the basic rate band. The trade-off is that dividends do not count as earnings for State Pension or mortgage affordability purposes.
Do I pay dividend tax on shares held in an ISA?
No. Dividends received inside a Stocks and Shares ISA are completely free of dividend tax, regardless of the amount. The ISA wrapper shields all income and gains. This makes ISAs particularly useful for holding dividend-paying shares or funds once you have used your £500 annual allowance.
How do I report dividend income to HMRC?
If your dividends exceed £500 in a tax year you must report them via Self Assessment. Register with HMRC and file a tax return by 31 January (online) after the end of the tax year. If you are employed and owe less than £3,000 in dividend tax, HMRC may collect it through an adjustment to your tax code instead.

For informational purposes only · Not financial advice · Tax rates shown are for 2026/27 · Always consult a qualified tax adviser for personal guidance