Dividend tax rates and allowance 2026/27
The dividend allowance and the basic, higher and additional dividend rates for 2026/27, with the year-on-year change and what it means for company directors.
- 2026/27 tax year, reviewed 2nd September 2026
- Figures from HMRC and the Treasury
- Updated automatically when rates change
- £500Dividend allowance
- 10.75%Basic rate
- 35.75%Higher rate
What changed from 2025/26 to 2026/27
| Item | 2025/26 | 2026/27 | Change |
|---|---|---|---|
| Dividend allowance | £500 | £500 | No change |
| Basic rate | 8.75% | 10.75% | +2 points |
| Higher rate | 33.75% | 35.75% | +2 points |
| Additional rate | 39.35% | 39.35% | No change |
Full rates and thresholds
Everything for 2026/27 in one place.
Rates
| Band | Rate | |
|---|---|---|
| Within the dividend allowance | 0% | |
| Basic rate band | 10.75% | |
| Higher rate band | 35.75% | |
| Additional rate band | 39.35% |
Tax on dividends taken by a director with a £12,570 salary
| Dividends | Tax 2025/26 | Tax 2026/27 |
|---|---|---|
| £10,000 | £831 | £1,021 |
| £30,000 | £2,581 | £3,171 |
| £50,000 | £7,406 | £8,396 |
| £80,000 | £17,531 | £19,121 |
Worth knowing
- Dividends are paid from profit after Corporation Tax, so the company has already paid 19% to 25% before the personal rate applies.
- The rates apply UK-wide; Scottish income tax bands do not change dividend tax.
- Dividends inside an ISA or pension are tax-free and do not use the allowance.
Run your own figures: Dividend vs Salary Calculator
Dividend vs Salary Calculator
Enter your figures to see results.
Frequently asked questions
Did dividend tax go up this year?
Yes. The basic and higher rates rose from 8.75% and 33.75% to 10.75% and 35.75% from 6 April 2026. The additional rate is unchanged at 39.35%.
Is salary plus dividends still worth it?
Usually yes, because employer National Insurance at 15% makes salary expensive, but the gap has narrowed. Run your own figures in the dividend vs salary calculator.