Use the dividend rates for the year the dividends belong to. The ordinary and upper rates differ between 2025/26 and 2026/27, while the £500 allowance applies in both. Provide vouchers and investment statements so the return uses the right year and income bands.
Which rates belong to which year?
For 2025/26, the dividend ordinary, upper and additional rates are 8.75%, 33.75% and 39.35%. For 2026/27, they are 10.75%, 35.75% and 39.35%. The dividend allowance is £500 in both years. The rate applying to a particular dividend depends on your wider income and available tax bands.
Dividends received between 6 April 2025 and 5 April 2026 belong to the return normally due online by 31 January 2027. Dividends in the following tax year need their own calculation. Do not combine the two years because the same company paid them.
The allowance does not remove the reporting question
Dividends within an ISA are treated differently from dividends outside it. An allowance covering some dividend income also does not mean every taxpayer can ignore dividend information when preparing a return.
If you already complete Self Assessment, give the accountant the full dividend figures. The information is needed to establish the complete income position and apply the allowance correctly.
Gather more than bank transfers
For your own company, provide dividend vouchers and the relevant company records. For investments, obtain tax-year dividend statements from each provider. A transfer labelled drawings is not automatically a lawful dividend, and money paid into your account may need a different explanation.
A useful check before approval
Compare the return's dividend total with your vouchers and investment statements, then check that the calculation uses the year being filed. Where dividends span tax bands, a single headline percentage will not explain the whole result.
TaxSimba can prepare your personal tax return within the agreed scope. Company accounts, dividend legality and director's loan issues may require separate work, so raise those matters before assuming that a personal return package covers them.
Dividend rates and where you live
Scotland and Wales use the UK rules for dividend taxation. Keep dividends separate from wages, pensions and trading income when reviewing the relevant rates and year.
Allocate each dividend to its actual tax year
Illustrative preparation example.
A company statement spans March and April. List payment dates and vouchers instead of applying one year’s rates to the whole statement. Keep dividends from other holdings visible too, because the tax calculation concerns the person’s combined income.
Check: Which dividend belongs in 2025/26 and which belongs in 2026/27?
| Check | Practical action |
|---|---|
| Which tax year contains each dividend? | Use the actual relevant dates and supporting vouchers or statements. |
| Which year's rates and allowance apply? | Check the calculation for the year being filed rather than today's default calculator. |
| Does other income use part of the tax bands? | Review the full personal income picture before applying a single percentage. |
Does the dividend allowance make the income irrelevant to a return?
No. Supply the full relevant dividend information so the annual calculation and reporting can be completed correctly.
Are all company withdrawals dividends?
No. The underlying records and lawful treatment matter. Obtain clarification of salary, loans or other transfers.
Download a checklist for this guide
- Collect dividend vouchers and provider statements.
- Separate payments by tax year.
- Identify ISA and non-ISA holdings.
- List other income affecting tax bands.
- Check the rates used before approving the return.