See how your salary or other income uses up tax bands before dividends are assessed. Dividends sit on top of non-dividend income, so your salary determines how much basic-rate space remains for dividend income.
Estimates only. Does not include income tax or National Insurance on your salary.
HMRC treats dividends as the top slice of income. Your salary fills the Personal Allowance (£12,570) and basic-rate band (up to £50,270 total income) first. Only the remaining basic-rate space is available for dividends before the 33.75% higher rate applies. A salary of £35,000 leaves £15,270 of basic-rate band for dividends — this calculator makes that split visible.
HMRC's ordering rules treat non-savings income (salary, pension) as the lowest slice, then savings income, then dividends at the top. This means salary fills the tax bands first, and dividends are taxed at whatever rate applies to the income above that level.
If your salary alone exceeds the basic-rate limit of £50,270, all of your dividends will fall into the higher-rate band (33.75%) or above, after the £500 dividend allowance. There is no basic-rate band remaining for dividends.
Yes. The £500 dividend allowance is applied before calculating taxable dividends. Dividends up to £500 (after using any remaining Personal Allowance) are free from dividend tax.
Disclaimer: Results are estimates based on 2026/27 rates. This tool does not constitute financial or tax advice.