Calculate the amount of tax owed on dividends for the 2026/27 tax year.
More calculators and guides
- 2025/26 dividend calculator
- 2024/25 dividend calculator
- How are dividends taxed?
- Most tax-efficient salary for directors
April 2026 dividend tax rise: Dividend tax rates increase by 2 percentage points at both the basic and higher rate levels. The additional rate remains unchanged.
Scroll down the page for tax tables, assumptions and notes.
Salary & Dividend Tax Calculator (2026/27)
Our partner limited company accountants
- Bright Ideas Accounting – £109/month, 5-star Google rating
- SG Accounting – First 3 months at £59.50 pm, no catch-up fees
- Clever Accounts – IR35 FLEX – take on any contract you are offered
- Aardvark Accounting – All-inclusive – £89 per month, no catch-up fees
Dividend tax rates and bands for 2026/27
The table below shows the new dividend tax rates that apply from 6 April 2026.
| Band | Dividend income range | 2026/27 rate |
|---|---|---|
| Basic | £0 to £37,700 | 10.75% |
| Higher | £37,701 to £125,140 | 35.75% |
| Additional | £125,140+ | 39.35% |
Tax-efficient life cover for company directors
Relevant Life lets directors pay premiums via their company, saving up to 50% compared to personal cover.
What is the £500 dividend allowance?
The first £500 of dividends are tax-free under the dividend allowance. This allowance is unchanged for 2026/27.
Although no tax is paid on this amount, it still uses up £500 of your basic rate band. This is why the calculator distinguishes between total income and taxable income.
The dividend allowance has fallen sharply over time, from £5,000 in 2016/17 to just £500 today.
How much extra dividend tax will you pay in 2026/27?
If your company pays you a £12,570 salary and £37,700 dividends (to take up the entire higher rate tax band), you will pay an extra £744 in dividend tax during 2026/27.
The maximum extra dividend tax payable due solely to the April 2026 rate rise is £2,492.80.
This occurs when an individual:
- takes all of their income as dividends, and
- has sufficient income to fully use the basic and higher dividend bands, and
- either does not take a salary, or has their Personal Allowance fully eroded at £125,140.
In practice, most directors will pay less than this amount, although many will pay additional tax of over £1,000 in the 2026/27 tax year.
How is your salary taxed in 2026/27?
Income Tax
- £0 to £12,570 – 0% (Personal Allowance)
- £12,571 to £50,270 – 20% basic rate
- £50,271 to £125,140 – 40% higher rate
- Over £125,140 – 45% additional rate
The Personal Allowance is reduced by £1 for every £2 of income above £100,000 and is fully removed once income reaches £125,140.
Employees’ National Insurance (paid via payroll)
- £12,570 to £50,270 – 8%
- Over £50,270 – 2%
Employers’ National Insurance (paid by the company)
- Over £5,000 – 15%
What is the most tax-efficient salary in 2026/27?
The optimum salary remains £12,570, as it has for the previous three tax years. Find out more here.
Assumptions and notes
- Rates and bands apply to England & Wales only and exclude Scotland.
- Only salary and dividend income are included.
- Other sources of income will affect your overall tax liability.
- The calculator assumes a standard tax code of 1257L unless income exceeds £100,000.
- The Employment Allowance is excluded, as most single-director companies do not qualify.
Our calculations have been reviewed by qualified accountants. This tool is provided for guidance only and should not replace personalised professional advice.