Dividend tax calculator 2026/27
Salary plus dividends, taxed in the order the law stacks them — with every band, every allowance and the cost of your next pound shown.
Calculator
Employment or self-employment income before tax. In a net-pay pension scheme, enter the salary after your contribution — see the note below.
Dividends received in the tax year, across all companies.
Bank and building society interest. Leave at £0 if it does not apply — it is here because savings income is taxed between your salary and your dividends.
Pension contributions are not included. If you are in a net-pay or salary sacrifice scheme, enter the salary after the contribution. If you pay into a personal pension or SIPP (relief at source), this calculator cannot model the band extension you get for it and will overstate your tax.
Scottish rates apply to earned income only. Dividends are taxed at UK-wide rates wherever you live — but your salary still decides which dividend band your dividends fall in.
Employee National Insurance on your salary is included, and so is a take-home figure. Dividends carry no National Insurance; a salary does. Student loan repayments, employer National Insurance and corporation tax are not included, so the take-home figure is too high for anyone repaying a student loan, and it is a personal figure rather than the company's.
Figures are 2026/27 income tax and employee National Insurance. Nothing you type is transmitted or stored: this page is a static file and the arithmetic runs in this tab. A share link is the exception — it carries your figures in the URL. What that means.
Your dividend tax, band by band
Dividend tax: £8,396.25
That is the tax on your dividends alone — the total of the dividend rows in step 3 below. Your income tax due on everything, salary and interest included, is £8,396.25, on £62,570 of total income, of which £50,000 is taxable after allowances. That is an effective rate of 13.42% across all your income.
If you have a number of shares and a dividend per share rather than an annual dividend total, the dividend calculator works out the income first and then carries it through the same tax calculation.
Two figures could be called your dividend tax and here they agree: adding up the dividend bands gives £8,396.25, and taking the dividends out of the calculation altogether cuts the bill by the same £8,396.25.
Band by band, in the order the law stacks them
1. Non-savings income
Salary and other earnings are taxed first, at the bottom of the stack. In Scotland this is the only part taxed at Scottish rates.
No salary entered, so nothing is taxed at this step.
2. Savings interest
Interest stacks on top of earnings and is taxed at UK-wide rates everywhere in the UK, including Scotland.
No savings interest entered, so nothing is taxed at this step.
3. Dividends
Dividends sit at the top of the stack. Everything below them decides which dividend rate they meet — this is the step most calculators hide.
| Band | Taxable income slice | Amount | Rate | Tax |
|---|---|---|---|---|
| Dividend allowance | £0 – £500 | £500.00 | 0.00% | £0.00 |
| Ordinary rate | £500 – £37,700 | £37,200.00 | 10.75% | £3,999.00 |
| Upper rate | £37,700 – £50,000 | £12,300.00 | 35.75% | £4,397.25 |
| Dividend tax | £8,396.25 |
The slice column is taxable income, measured from £0 after allowances — not your salary. Bands shown at 0% still use up room in the stack, which is why a nil-rate allowance can change the rate on the income above it.
National Insurance on your salary
Employee Class 1 National Insurance: £0.00. Dividends carry no National Insurance, and neither does savings interest — the charge here is on your salary of £12,570 and nothing else. That gap is much of why a director takes dividends in the first place, so it is shown as its own figure rather than folded into the tax above.
Your salary is at or below the primary threshold of £12,570, so no employee National Insurance is due on it. A salary set at exactly that threshold is the usual director's arrangement for this reason.
The slice column here is salary, not taxable income — National Insurance has its own thresholds and takes no account of the personal allowance. Earnings between £12,570 and £50,270 are charged at 8.00%, and everything above the upper earnings limit at 2.00%, so the rate falls at the point the income tax rate rises. This is the employee's contribution only; the employer pays a further contribution on top of your salary, which is a cost to the company and is not shown here.
What you keep
Take-home: £54,173.75
| Line | Amount |
|---|---|
| Total income | £62,570.00 |
| Less income tax | −£8,396.25 |
| Less employee National Insurance | −£0.00 |
| Take-home | £54,173.75 |
Three things are not in that figure, and each one moves it. Student loan repayments are not deducted, so if you are repaying a student or postgraduate loan your real take-home is lower by the amount of that repayment — this calculator does not model any repayment plan. Pension contributions are not modelled either: the calculation has no pension input, so nothing has been taken out for a contribution, and relief at source — the band extension a personal pension or SIPP gives you — is not applied at all, which overstates the income tax above and understates what you keep. And this is your personal position only: the company pays corporation tax on its profit before a dividend can be declared, so the money reaching you has already been taxed once in the company and none of that is in the figure.
Allowances, including what went unused
| Allowance | Available at this income | Used | Unused |
|---|---|---|---|
| Personal allowance | £12,570.00 | £12,570.00 | £0.00 |
| Starting rate for savings | £5,000.00 | £0.00 | £5,000.00 |
| Personal savings allowance | £500.00 | £0.00 | £500.00 |
| Dividend allowance | £500.00 | £500.00 | £0.00 |
Every figure here describes the allowance at the income you entered. An unused allowance is not the same thing as income you could still receive tax-free, because receiving more income can change the allowance itself.
Your personal savings allowance has £500.00 unused, but that is not £500.00 of tax-free interest. Adding it would cost £125.00 in tax: receiving the interest can push you into the next band, which halves this allowance, and it lifts your dividends further up the stack. The figure is a full recalculation with the interest included, not an estimate.
Where your next pound goes
- Your next £1 of salary is taxed at 45.00%. Where that goes: another £100.00 of salary costs £45.00 in tax — £20.00 on the salary itself, and £25.00 more on your dividends. Your dividends sit on top of your salary, so raising the salary lifts every one of them the same distance up the stack — which is how a rate above every rate listed on this page is arrived at without any of those rates changing.
- Your next £100 of dividends costs £35.75 in tax. Dividends have their own rates and sit above everything else, so this is a different number from the salary figure above.
Distance to the next threshold
Another £62,570 of income takes you into the Additional rate band.
The calculation measures that gap as £75,140 of taxable income, which is not the same figure. Above £100,000 each extra £1 of income also withdraws 50p of personal allowance, so £1 of income exposes £1.50 of taxable income and the gap closes half as fast again. Reading the taxable figure as the income you can still take is the mistake this line exists to prevent.
Worked example: a director on a 2026/27 salary and dividends
A company director takes a salary of £12,570 — the personal allowance — and £50,000 in dividends, living in England, in the 2026/27 tax year. Total income £62,570.
- The personal allowance of £12,570 covers the salary entirely, so no income tax is due on it. Taxable income is £50,000.
- There is no savings interest, so nothing is taxed at step 2 of the stack.
- The dividends stack on top. The first £500 is the dividend allowance, taxed at 0% — but it still occupies room in the band below, so the dividends above it start that much higher up. Then £3,999.00 on £37,200 at 10.75%, then £4,397.25 on £12,300 at 35.75%.
| Band | Taxable income slice | Amount | Rate | Tax |
|---|---|---|---|---|
| Dividend allowance | £0 – £500 | £500.00 | 0.00% | £0.00 |
| Ordinary rate | £500 – £37,700 | £37,200.00 | 10.75% | £3,999.00 |
| Upper rate | £37,700 – £50,000 | £12,300.00 | 35.75% | £4,397.25 |
| Income tax due | 13.42% | £8,396.25 |
The same figures in Scotland give £8,396.25. Scottish rates apply to earned income only, and this salary sits inside the personal allowance, so no part of it meets a Scottish rate — the dividends are taxed on the UK-wide dividend schedule either way.
National Insurance, and what the director keeps
Employee National Insurance on the salary is £0.00. The primary threshold for 2026/27 is £12,570 and this salary is exactly at it, so nothing is charged — which is a large part of why a director sets the salary there. The £50,000 of dividends carries no National Insurance at any level of income: that is the structural difference between salary and dividends, and it is why the mix is a decision at all.
So the take-home is £62,570 less £8,396.25 of income tax less £0.00 of National Insurance — £54,173.75.
That is a personal figure and it is not net pay. The company pays corporation tax on the profit before this dividend can be declared, so the money has already been taxed once before it reaches the director. Student loan repayments are not deducted, and no pension contribution is modelled — this calculation has no pension input at all.
Methodology and sources
The formula
- Add up income and deduct the personal allowance of £12,570. Above £100,000 the allowance is withdrawn by £1 for every £2 of income, so it is gone by £125,140.
- Tax the remainder in the statutory order: non-savings income, then savings income, then dividends. Each slice starts where the one below it finished, which is why dividends meet the rate your salary leaves them at.
- Allocate the allowance across those types in the way that produces the lowest bill. The taxpayer is entitled to that (Income Tax Act 2007 s.25(2)) and HMRC's own self-assessment calculation does it, so a fixed order would over-tax ordinary income mixes.
- Apply the nil-rate bands — the dividend allowance, the starting rate for savings and the personal savings allowance — as bands, not as deductions. They are taxed at 0% and still use up room, which changes the rate on the income above them.
Dividend rates, 2026/27
| Band | Taxable income from | Rate |
|---|---|---|
| Dividend allowance | — | 0% on the first £500 |
| Ordinary rate | £0 | 10.75% |
| Upper rate | £37,700 | 35.75% |
| Additional rate | £125,140 | 39.35% |
These thresholds are taxable income, after allowances, and they are UK-wide: the Scottish rates and bands apply to earned income only.
National Insurance and take-home
Employee Class 1 National Insurance is charged on the salary and on nothing else. Dividends carry none — that is a statutory difference between the two, not a simplification here — and neither does savings interest. It is worked out on its own thresholds, which take no account of the personal allowance even where the two happen to be the same figure.
| Band | Salary from | Rate |
|---|---|---|
| Below the primary threshold | — | 0% up to £12,570 |
| Main rate | £12,570 | 8.00% |
| Upper rate | £50,270 | 2.00% |
Note the direction: above the upper earnings limit of £50,270 the National Insurance rate falls to 2.00%, at almost the point the income tax rate rises. These are annual thresholds as HMRC publishes them, not weekly figures multiplied by 52 — the two do not agree, and the annual one governs an annual calculation.
Take-home is then subtraction and nothing more: total income, less the income tax above, less that National Insurance. It is not net pay. Student loan repayments are not modelled, so the figure is too high for anyone repaying one; no pension contribution is modelled, because the calculation has no pension input; and the corporation tax the company paid before the dividend could be declared is outside it entirely.
Sources
- gov.uk — Tax on dividends
- gov.uk — National Insurance rates and allowances
- gov.uk — Income tax rates and allowances
- gov.scot — Scottish income tax rates and bands
- gov.uk — Tax on savings interest
Contains public sector information licensed under the Open Government Licence v3.0.
What has been verified, and what has not
The rates, thresholds and allowances this calculator uses were checked against gov.uk and gov.scot on 12 August 2026, figure by figure. That check covers the published rates only. It does not verify any result this page produces, and no named person has signed the check off yet. Treat the output as a calculation you can check — the breakdown above shows every step for exactly that reason — not as advice, and not as a figure to file a return from without checking it.
What this calculator does not do
- Student loan and postgraduate loan repayments. No repayment plan is modelled, so the take-home figure is too high by the whole of the repayment for anyone making one. Employee National Insurance is included — see above — so this list no longer disclaims it.
- Employer National Insurance. The secondary contribution the company pays on top of a salary is a cost to the company, not a deduction from the employee, and it is not shown here.
- Corporation tax on the profits a dividend is paid from. The take-home figure is a personal one: the company has already paid tax on that profit before the dividend could be declared.
- Pension contributions. There is no pension input. For a net-pay or salary sacrifice scheme, enter the salary after the contribution. Relief-at-source band extension — the mechanism that lets a personal pension shelter higher-rate income — is not modelled at all, so this page overstates the tax of anyone relying on it, and correspondingly understates what they keep.
- Anything outside these three income types. Rental profit, foreign income, benefits in kind, the high income child benefit charge, the marriage allowance and blind person's allowance are all outside it.
- Welsh divergence. Wales sets its own earned-income rates but currently matches England and Northern Ireland, so the two answers are identical today. They are modelled separately so that stops being true safely.
Nothing you type is transmitted or stored — there is no application server and no database. A share link is the exception: it carries your figures in the URL. What that means.
Dividend tax questions
- How much tax will I pay on £50,000 of dividends?
It depends on the rest of your income, because dividends are taxed as the top slice of it. On a £12,570 salary with £50,000 of dividends in 2026/27, the income tax due is £8,396.25: the first £500 is covered by the dividend allowance, then £3,999.00 on £37,200 at 10.75%, then £4,397.25 on £12,300 at 35.75%. Raise the salary and the same dividends cost more, because they start higher up the bands.
- Do I pay National Insurance on dividends?
No. Dividends carry no National Insurance at any level of income, which is much of the reason a director takes them. Your salary does, and this calculator works out that employee Class 1 charge and shows it as its own figure, so the take-home number is after both income tax and National Insurance. It still excludes employer National Insurance, student loan repayments, and the corporation tax the company pays before a dividend can be declared.
- Is the take-home figure what actually reaches my bank account?
Not quite, and the gaps are worth knowing. The figure is your total income less income tax less employee National Insurance, and nothing else has been taken off. Student loan and postgraduate loan repayments are not modelled, so if you are repaying one your real take-home is lower by the whole of that repayment. No pension contribution is modelled either — the calculation has no pension input, so nothing has been deducted for one and relief at source is not applied. And it is a personal figure: the company pays corporation tax on the profit before a dividend can be declared, so the dividend part has already been taxed once before it reaches you.
- How much National Insurance will I pay on my salary?
Employee Class 1 National Insurance in 2026/27 is nothing on the first £12,570 of salary, 8.00% on the slice between £12,570 and the upper earnings limit of £50,270, and 2.00% on everything above that. The rate falls at the upper earnings limit, almost exactly where the income tax rate rises. These thresholds are National Insurance's own and are unaffected by the personal allowance, and none of it touches your dividends.
- Which dividend tax rate applies to me?
Whichever band your dividends fall into once they are stacked on top of everything else. Non-savings income is taxed first, savings interest next, dividends last — so one dividend can be taxed at two rates, and the rate is decided by your salary rather than by the dividend.
- Are dividend tax rates different in Scotland?
No. Scottish rates and bands apply to earned income only; dividends are taxed on the UK-wide schedule wherever in the UK you live. Your Scottish earned income still matters, because it decides where the dividends sit in the stack, but the thresholds the dividends meet are the UK ones — £37,700 and £125,140 of taxable income — not the Scottish bands.
- Does this include my pension contributions?
No, and the calculation has no pension input at all. If you are in a net-pay or salary sacrifice scheme, enter your salary after the contribution and the answer will be right. If you pay into a personal pension or SIPP, where relief at source extends your basic-rate band, that extension is not modelled and this calculator will overstate your tax.
- Is the dividend allowance tax-free income?
It is taxed at 0%, but it is a nil-rate band rather than income removed from the calculation. The first £500 of dividends still uses up room in the band it sits in, so it pushes the dividends above it further up the schedule. That is why the breakdown lists it as a band at 0% rather than deducting it.
- How much more can I take before I reach the next tax band?
Read the gross figure in the breakdown, not the taxable one. Distance to a threshold is naturally measured in taxable income, and the two are not the same: any unused personal allowance sits between them, and between £100,000 and £125,140 each extra £1 of income also withdraws 50p of allowance, so £1.50 of taxable income costs only £1 of income there. This page converts the figure before showing it.
- Does an unused savings allowance mean I can earn that much interest tax-free?
Not necessarily, and this is the trap. The personal savings allowance is £1,000 for a basic-rate taxpayer and £500 for a higher-rate one, and the interest itself counts towards deciding which you are — so receiving the allowance you appear to have left can be exactly what halves it. The breakdown recalculates with that interest included and tells you what it would actually cost.