Your details
£
£
Dividends are taxed on top of your other income.
Where do you live?
Tax on your dividends
£4,821.25
per year
Dividends you keep 88% Dividend tax 12%
| Dividends | £40,000.00 |
| Dividend tax | −£4,821.25 |
| Dividends after tax | £35,178.75 |
| Tax on your other income | £0.00 |
| Total income tax | £4,821.25 |
Want us to handle this for you?
Our accountants can run your payroll, file your tax return and make sure you never pay more than you should.
How your dividends are taxed
Personal allowance: £12,570 — used against your other income first.
- Dividend allowance (0%) on £500£0.00
- Dividends — basic rate (10.75%) on £37,200£3,999.00
- Dividends — higher rate (35.75%) on £2,300£822.25
2026/27 dividend rates: 10.75% basic, 35.75% higher, 39.35% additional. The first £500 is tax-free but still counts towards your tax bands. Scottish income tax rates don't apply to dividends. Dividends over £10,000 usually need a Self Assessment return.
Estimates only, based on 2026/27 rates for typical situations. They are not financial advice — speak to us about your own circumstances. Rates last checked: October 2026 (GOV.UK).