How it works
Enter your total dividends for the tax year and your marginal income-tax band (basic, higher or additional). We apply the £500 dividend allowance and the 2026/27 dividend rates in your browser.
In detail
Dividends are taxed after a £500 tax-free allowance for 2026/27. The rate you pay depends on your marginal income-tax band.
2026/27 dividend tax rates
| Band | Rate |
|---|---|
| Dividend allowance | £500 (tax-free) |
| Basic-rate taxpayers | 10.75% |
| Higher-rate taxpayers | 35.75% |
| Additional-rate taxpayers | 39.35% |
Your band is set by your other taxable income (salary, pensions, savings interest above allowances). Dividends within the allowance still count towards your band, so a large dividend can push other dividends into a higher rate.
The rates increased by 2 percentage points from 6 April 2026. The authoritative source is GOV.UK — Tax on dividends.
FAQ
What is the dividend allowance in 2026/27?
£500. Dividends up to £500 are tax-free. Anything above that is taxed at your marginal rate.
What are the dividend tax rates for 2026/27?
Basic rate 10.75%, higher rate 35.75% and additional rate 39.35%. These rose by 2 points from April 2026.
How do I know my band?
Your band is determined by your other income (salary, pension, savings above allowances) for the year. Dividends sit on top of that income.
Are ISA dividends taxed?
No. Dividends from shares held inside an ISA are tax-free and do not use your dividend allowance.