Want to find out how much tax you’ll pay on your dividends? It’s easy! Simply tap the numbers into our dividend calculator to find out.
2016-17 Dividend Tax Increase Calculator
TAX ON SALARY
TAX ON DIVIDENDS
From April 2016, dividends are no longer grossed up.
Taxable gross income = Gross salary + other income + dividend + tax free personal allowance
Dividends are taxed at the basic rate of 7.5% then the higer rate of 32.5% and the additional rate of 38.1% thereafter. There is no longer a tax credit.
UPDATE ( 19th August 2015): The new Dividend Tax Allowance(£5k) was described in the Summer budget as being a “tax-fre allowance”, tather than as a 9% rate(”zero rate”). Hoever , HMRC have now said that it is a zero rate and that it counts towards allowances. After using up any remaining personal allowance the dividends are taxed at 0% for the first £5K, and then at the publised divided rates after that.
The additional tax due is paid as part of your annual tax return.