FullWorkings UK tax and finance calculators

Dividend tax

2026-27

Your income

DividendsThe total taken this tax year. £
Everything elseSalary, self-employment, pension, rent. It decides which band the dividends land in. £
Where you liveScotland sets its own rates on earnings, but not on dividends.

What the dividends cost

Tax on dividends £0.00 a year
Dividends taken£0.00
Covered by the dividend allowance£0.00
Taxable£0.00
Tax£0.00
Left after tax£0.00

Rates

Effective rate on the dividends—
Rate on the next £100—
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How this is worked out

Dividends are taxed as the top slice of your income, so the rate depends on everything else you earn.

The same £5,000 of dividends can be taxed at three different rates depending on a salary that has nothing to do with them. That is why this calculator asks for your other income: without it, a dividend figure on its own cannot be turned into a tax figure at all.

The dividend allowance is not an exemption

It is a 0% band, and the difference matters. The allowance still uses up room in whichever band it falls in, so it does not push the rest of your dividends down into a lower band. Treating it as tax-free income that costs nothing under-states the tax for anyone sitting near a threshold.

Your Personal Allowance can cover dividends too, but only what your other income has not already used.

Scotland

⚠ Scotland sets its own Income Tax rates on earnings, and not on dividends. Dividend tax is the same across the UK, so a Scottish taxpayer's dividends use the UK bands even though their salary does not. Applying the Scottish ladder to dividends is a common mistake and it over-states the tax.

The rate on the next pound

The effective rate is what the dividends cost on average. The marginal rate is what the next pound would cost, and it is usually the more useful of the two — it is the figure that decides whether to take more this year or wait for the next.

It is measured over the next £100 rather than the next pound. Tax is worked out to the penny, so a single pound is too small a step to measure a rate with: the rounding would show through as a rate that is not real.

What this does not cover

Dividends held inside an ISA or a pension, which are not taxable at all. Dividends from overseas companies and any foreign tax on them. Whether taking money out as dividends rather than salary is the right choice for you — that depends on Corporation Tax, National Insurance and your own circumstances, and it is a question for an accountant rather than a calculator.

Where these figures come from

Every rate above is read from a dated rate file rather than written into the page, and each one is checked against the gov.uk page it came from. How these numbers are kept right sets out the whole process.

Take-home pay calculator