💰 Dividend Tax · 2025/26

Dividend Tax Calculator

Calculate UK dividend tax for individuals — covering the £500 dividend allowance, interaction with salary & other income, personal allowance taper above £100,000, multi-band splitting, and director/shareholder planning. Includes comparison to 2026/27 rate changes (basic 10.75%, higher 35.75%). Official guidance: Tax on dividends – GOV.UK →

💰 Income Details

Employment / Pension / Other Income

Salary / employment income (gross) Before PAYE tax deductions

Pension income (£/yr) State + private pension — taxable amount

Savings interest (£/yr) Bank interest after Personal Savings Allowance

Other taxable income (£/yr)

Dividend Income

Total dividend income (£/yr) From all UK and overseas companies

ISA / pension dividends (excluded) Dividends inside ISA or pension — NOT taxable

Reliefs & Allowances

Pension contributions (net, £/yr) Personal pension — extends basic rate band

Gift Aid payments (net, £/yr) Also extends basic rate band by grossed up amount

Tax year

Scotland? Dividend rates are UK-wide; income tax bands differ but dividend tax unchanged

Income composition (live)

Personal Allowance

Div. Allowance (0%)

Basic rate

Higher rate

Additional rate

Total income: £0

⚠️ From April 2026 (2026/27) Dividend rates will increase: basic rate 8.75% → 10.75%, higher rate 33.75% → 35.75%. Additional rate stays at 39.35%. Use the Year Comparison tab to see the impact on your dividends. [web:56][web:57]

⚠️ Disclaimer This is an estimate. Actual tax is assessed via Self Assessment. Does not cover Scottish income tax bands, EIS/SEIS, VCT exemptions, or foreign dividend credits. Tax on dividends – GOV.UK →

💰 Dividend Tax Result

2025/26 · UK rates

💰

Enter dividend income and click Calculate.

Div. Tax

£0

on dividends

Income Tax

£0

on other income

Total Tax

£0

combined

Income Summary

Salary / employment£0

Pension income£0

Savings interest£0

Other income£0

Non-dividend income£0

Dividend income (gross)£0

ISA / pension dividends (excluded)£0

Total taxable income£0

Personal Allowance

Standard personal allowance£12,570

Taper reduction (above £100,000)–£0

Adjusted personal allowance£12,570

Band Allocation

Personal allowance used on non-div income£0

PA remaining for dividends£0

Dividend allowance (£500 at 0%)£0

Dividends in basic rate band (8.75%)£0

Dividends in higher rate band (33.75%)£0

Dividends in additional rate band (39.35%)£0

Dividend Tax Calculation

Basic rate (8.75%)£0

Higher rate (33.75%)£0

Additional rate (39.35%)£0

Total dividend tax£0

Income Tax on Other Income

Taxable non-dividend income (after PA)£0

Basic rate (20%) portion£0

Higher rate (40%) portion£0

Additional rate (45%) portion£0

Total income tax (non-div)£0

Total Tax Summary

Dividend tax

£0

Income tax on other income

£0

Total tax

£0

Effective Rates

Dividend tax as % of dividend income
0%

Total tax as % of total income
0%

Take-home after all tax
£0

🏢 Director / Owner-Manager Planning Optimal salary + dividend mix

Classic owner-manager structure Many directors pay a low salary (often at the NI secondary threshold £9,100 or primary threshold £12,570) to preserve CT deductibility with minimal NI, then extract remaining profit as dividends taxed at dividend rates. This tool models that.

Company & Personal Details

Company profit before salary (£)

Director salary (£/yr)

Dividends to be extracted (£/yr)

Associated companies

Quick Presets

🏢 Director Planning Result

Combined CT + Dividend Tax

🏢

Enter profit and extraction details and click Run Analysis.

📅 Year Comparison 2025/26 vs 2026/27

Rate Changes from 6 April 2026 Basic rate: 8.75% → 10.75% (+2pp). Higher rate: 33.75% → 35.75% (+2pp). Additional rate: 39.35% → unchanged. Dividend allowance: £500 → £500 (unchanged). [web:56][web:58]

Your Details

Non-dividend income (salary, pension, etc.)

Dividend income (£)

📅 Year Comparison

2025/26 vs 2026/27 dividend rates

📅

Enter income and click Compare.

📋 Dividend Tax Reference 2025/26

Dividend tax rates

Tax band	Taxable income	2025/26	2026/27 From Apr 2026
Zero (allowance)	First £500	0%	0%
Basic rate	£12,571 – £50,270	8.75%	10.75%
Higher rate	£50,271 – £125,140	33.75%	35.75%
Additional rate	Over £125,140	39.35%	39.35%

Allowances & thresholds 2025/26

Item	Amount	Notes
Personal Allowance	£12,570	Tapers £1 for every £2 over £100,000; zero by £125,140
Dividend Allowance	£500	Counts toward band; 0% rate applies
Basic rate band	£12,571 – £50,270	Income above PA up to £50,270
Higher rate band	£50,271 – £125,140	—
Additional rate	Over £125,140	PA fully withdrawn
Personal Savings Allowance (basic)	£1,000	Interest up to £1,000 tax-free (basic rate taxpayers)
Personal Savings Allowance (higher)	£500	Interest up to £500 tax-free (higher rate taxpayers)

Historical dividend allowance

Tax year	Dividend allowance
2016/17	£5,000
2017/18 – 2022/23	£2,000
2023/24	£1,000
2024/25 onwards	£500

Self Assessment rules for dividends

Situation	Self Assessment required?
Dividends over £10,000	Yes — must file SA return
Dividends £500 – £10,000 (unpaid tax)	Yes — HMRC may adjust via PAYE or require SA
All dividends within £500 allowance	Usually no SA needed
Income over £100,000 (PA taper)	Yes — always SA required

Personal Allowance Trap — 60% effective rate Between £100,000 and £125,140 you lose £1 of PA for every £2 of income. This means income in this range effectively faces a 60% income tax rate (40% higher rate + 20% on income newly exposed by loss of PA). Pension contributions or Gift Aid payments reduce adjusted net income and can recover the allowance.

Ordering of income for tax purposes HMRC treats income as stacked in a fixed order: (1) non-savings income (salary, pension, rental), (2) savings income (interest), (3) dividend income. Dividends are always the top slice, meaning they take up the remaining band after other income is allocated. This can push dividends into higher bands even if salary alone would be basic-rate.