Tax calculators
UK Dividend Tax Calculator
See exactly how your dividends are taxed, band by band, using the dividend allowance and your salary and other income.
Estimated dividend tax
£2,096
on £20,000 of dividends
Net dividends: £17,904
Summary
- Dividends received
- £20,000
- Other taxable income
- £12,570
- Personal Allowance
- £12,570
- Personal Allowance set against dividends
- £0
- Dividend allowance usedDividend allowance for this year: £500
- £500
- Dividend tax
- £2,096.25
- Net dividends after tax
- £17,903.75
- Effective dividend tax rate
- 10.5%
Dividend tax band by band
| Band | Rate | Amount | Tax |
|---|---|---|---|
| Dividend allowance | 0.00% | £500.00 | £0.00 |
| Dividend ordinary rate | 10.75% | £19,500.00 | £2,096.25 |
Your dividends
- Net dividends — £17,904 (90%)
- Dividend tax — £2,096 (10%)
These calculations are estimates based on the information entered and the tax rates and assumptions shown. They are intended as a general guide and do not constitute tax advice. Your actual tax position may differ depending on your circumstances, reliefs, other income and applicable tax rules.
About this tool
What the dividend tax calculator does
This calculator works out the Income Tax due on dividends for shareholders and company directors. It takes your salary and any other taxable income into account, applies the Personal Allowance and the dividend allowance, then taxes the remaining dividends band by band.
It shows the amount falling into each dividend band rather than applying a single percentage, because most people's dividends straddle at least two rates.
Method
How the calculation works
Your Personal Allowance is set against non-dividend income first, and any unused allowance is then set against dividends. Dividends sit on top of the rest of your income, so the band they fall into depends on what has already been used.
For 2026/27, the dividend allowance is £500 taxed at 0%, the ordinary rate is 10.75%, the upper rate is 35.75% and the additional rate is 39.35%.
The dividend allowance uses up band space even though no tax is charged on it, which is why it reduces your bill by a fixed amount rather than shifting your other dividends into a lower band.
Worked example
£40,000 of dividends on a £12,570 salary
A director taking a £12,570 salary uses the whole Personal Allowance against that salary, so no Income Tax is due on the salary itself and the full basic rate band of £37,700 is available for dividends.
The first £500 of dividends is covered by the dividend allowance at 0%, but still uses £500 of band space. The next £37,200 falls within the basic rate band and is taxed at the ordinary rate, and the remaining £2,300 is taxed at the upper rate.
The calculator above shows this split line by line, including the exact tax for each band for whichever tax year you select.
Assumptions
What this calculator assumes
It assumes dividends are legally declared out of distributable profits, that Income Tax rates for England, Wales and Northern Ireland apply, and that no other allowances such as the Marriage Allowance, Blind Person's Allowance, or personal pension contributions are in play unless included in your other figures.
Dividends rarely sit in isolation. The director salary and dividend calculator shows the company side too, and our tax planning service looks at the combination as a whole.
Rates and assumptions
What this calculator uses
- Tax year shown
- 2026/27
- Geographical scope
- England, Wales and Northern Ireland
- Rates last reviewed
- 19 September 2026
- Source of rates
- HMRC / GOV.UK
Official guidance
- Tax on dividends (GOV.UK)
- Income Tax rates and Personal Allowances (GOV.UK)
- Rates and allowances for Income Tax (GOV.UK)
- Self Assessment tax returns (GOV.UK)
These calculations are estimates based on the information entered and the tax rates and assumptions shown. They are intended as a general guide and do not constitute tax advice. Your actual tax position may differ depending on your circumstances, reliefs, other income and applicable tax rules.
Questions
Common questions
Dividends are treated as the top slice of your income. Your salary and other income fill the basic rate band first, so the same dividend can be taxed at the ordinary rate for one person and the upper rate for another.
Need advice on dividends and director remuneration?
We help company owners in Scunthorpe plan dividends around profits, personal tax bands and cash flow, rather than finding out the cost in January.
Related services
Services that work alongside this
- Explore self assessment tax returns
Returns prepared and filed for sole traders, directors, landlords and higher earners — early, accurate and with the reliefs claimed.
- Explore tax planning
Legitimate, well-documented planning across profit extraction, capital investment, pensions, property and succession.