Dividend Tax for 2025/26: the Rates and Dates for Your January 2027 Tax Return
The tax return due on 31 January 2027 covers dividends you received between 6 April 2025 and 5 April 2026. Dividend tax went up by 2 percentage points from 6 April 2026, so the rates quoted almost everywhere now, including in our calculators, are higher than the ones that apply to this return. Here are the 2025/26 figures, the dates, and two worked bills.
For 2025/26, the first £500 of dividends is tax-free, then dividends are taxed at 8.75% in the basic-rate band, 33.75% in the higher-rate band and 39.35% above £125,140.1 Those are the rates for the return you file by 31 January 2027, with the tax paid by the same date.5 The 10.75% and 35.75% rates apply only to dividends received from 6 April 2026. Example: £3,000 of dividends on a £35,000 salary costs £218.75 for 2025/26, not £268.75.
- 2025/26: £500 allowance; 8.75% / 33.75% / 39.35%. 2026/27: £500; 10.75% / 35.75% / 39.35%.1
- File online and pay by 11:59pm on 31 January 2027; the paper deadline was 31 October 2026.5
- Have a job or pension? File online by 30 December 2026 and a bill under £3,000 can be collected through your tax code.3
- UK company dividends go in box 4, unit trust and OEIC distributions in box 5, foreign dividends up to £500 in box 6.4
- GOV.UK: current penalties apply to the 2025/26 return due 31 January 2027.6
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2025/26 vs 2026/27 dividend tax
| Dividends received | 6 Apr 2025 to 5 Apr 2026 | 6 Apr 2026 to 5 Apr 2027 |
| Dividend allowance (0% rate) | £500 | £500 |
| Basic rate (ordinary) | 8.75% | 10.75% |
| Higher rate (upper) | 33.75% | 35.75% |
| Additional rate | 39.35% | 39.35% |
| Personal Allowance; higher rate from; additional rate from | £12,570; £50,270; £125,140 (both years) |
| Return and payment due | 31 January 2027 | 31 January 2028 |
2025/26 | 2026/27. UK-wide, including Scotland: dividends use the UK bands. Source: HMRC's Income Tax rates table, checked 22 October 2026.1
Worked example: an investor with a salary
Dan earned £35,000 in 2025/26 and received £3,000 of dividends from shares held outside an ISA. His salary uses his Personal Allowance and keeps him in the basic-rate band, so his dividends above the allowance are taxed at the 2025/26 basic rate.1
| Dividends received in 2025/26 | £3,000.00 |
| Dividend allowance at 0% | £500.00 |
| £2,500 at 8.75% | £218.75 |
| Dividend tax for 2025/26 | £218.75 |
| The same dividends in 2026/27 (at 10.75%) | £268.75 |
Using the 2026/27 rate on a 2025/26 return would overstate the bill by £50.
Dan's bill is under £1,000, so no payments on account are due.2 Because he has a PAYE job, he can file online by 30 December 2026 and have the £218.75 collected through his tax code instead of paying in January.3
Worked example: a director's first January bill
Ravi paid himself a £12,570 salary and £50,100 of dividends from his company in 2025/26, his first year filing. The salary is covered by the Personal Allowance, so all his tax is dividend tax.
| Dividends | £50,100.00 |
| Dividend allowance (0%) | £500.00 |
| £37,200 at 8.75% | £3,255.00 |
| £12,400 at 33.75% | £4,185.00 |
| 2025/26 dividend tax | £7,440.00 |
| First payment on account for 2026/27 (50%) | £3,720.00 |
| Due 31 January 2027 | £11,160.00 |
| Second payment on account, due 31 July 2027 | £3,720.00 |
Payments on account are each half of the previous year's bill, due 31 January and 31 July.2
The same dividends in 2026/27 cost £8,432 at the new rates. Ravi's 2026/27 payments on account are based on the lower 2025/26 bill, so £992 (£8,432 − £7,440) is left to pay as a balancing payment on 31 January 2028. If you take similar dividends this year, set aside for that too.
Where dividends go on the 2025/26 return
On the main return (SA100), put the total dividends from UK companies in box 4, including dividends from your own company and from employee share schemes. Distributions from authorised unit trusts and open-ended investment companies, including accumulation units, go in box 5. Foreign dividends of up to £500 go in box 6; above that, use the Foreign pages (SA106).4
Enter the dividends you actually received in the tax year. Your platform's consolidated tax certificate for 2025/26 usually shows the total. Enter the total; HMRC's calculation applies the £500 allowance.4 ISA dividends are not entered at all.
Penalties and interest
GOV.UK says the current penalties apply to the 2025/26 return due 31 January 2027.6 File late and there is an immediate £100 penalty, then daily penalties after three months; unpaid tax picks up 5% penalties at 30 days, six months and twelve months.7 Interest runs at 7.75% a year (from 9 January 2026), Bank of England base rate plus 4%.8
Check 2026/27 as well
Our calculators use 2026/27 rates, so they show this year's bill; take 2 percentage points off the basic and higher rates for 2025/26.
Open director dividend calculatorRelated pages
Sources & references
Every headline figure in this guide is drawn from the official HMRC and GOV.UK sources below and reflects the confirmed 2026/27 rates. Each link opens the relevant official page in a new tab.
- Income Tax rates and allowances for current and past years ↗ https://www.gov.uk/government/publications/rates-and-allowances-income-tax/income-tax-rates-and-allowances-current-and-past
- Understand your Self Assessment tax bill: payments on account ↗ https://www.gov.uk/understand-self-assessment-bill/payments-on-account
- Pay your Self Assessment tax bill: through your tax code ↗ https://www.gov.uk/pay-self-assessment-tax-bill/through-your-tax-code
- How to fill in your tax return 2026 (SA150 notes, 2025 to 2026) ↗ https://www.gov.uk/government/publications/self-assessment-tax-return-sa100
- Self Assessment tax returns: deadlines ↗ https://www.gov.uk/self-assessment-tax-returns/deadlines
- Penalties for Making Tax Digital for Income Tax ↗ https://www.gov.uk/guidance/penalties-for-making-tax-digital-for-income-tax
- Self Assessment tax returns: penalties ↗ https://www.gov.uk/self-assessment-tax-returns/penalties
- HMRC interest rates for late and early payments ↗ https://www.gov.uk/government/publications/rates-and-allowances-hmrc-interest-rates-for-late-and-early-payments/rates-and-allowances-hmrc-interest-rates
Frequently asked questions
What are the dividend tax rates for 2025/26?
Which rates do I use on the tax return due 31 January 2027?
When is dividend tax for 2025/26 due?
Which box do dividends go in on the 2025/26 tax return?
Can my 2025/26 dividend tax be collected through my tax code?
Why will my January 2028 bill be bigger if my dividends stay the same?
Disclaimer: General information about UK tax for 2026/27, not personal tax advice. Figures assume England, Wales or Northern Ireland income tax bands unless stated.