Dividend tax on £21,000
Quick answer
Taking £21,000 in dividends on top of a £12,570 salary, the dividend tax is about £2,204 for 2026/27 — leaving £18,796 after tax.
- Dividends
- £21,000
- Dividend allowance
- − £500
- Taxable dividends
- £20,500
- Dividend tax
- £2,204
How much dividend tax on £21,000?
Assuming you're a company director taking a £12,570 salary (using your Personal Allowance) plus £21,000 in dividends, the dividend tax for 2026/27 is about £2,204. The first £500 of dividends is covered by the dividend allowance and taxed at 0%; the remaining £20,500 is taxed at the dividend rates.
Your actual bill depends on your other income, so treat this as a typical-director estimate and use the dividend tax calculator for your exact position.
How dividend tax works
Dividends sit on top of your other income and have their own rates and a tax-free allowance. After the allowance, dividends falling in the basic-rate band are taxed at the ordinary dividend rate, then higher and additional rates apply as your total income rises. Dividends carry no National Insurance, which is why the salary-plus-dividends mix is common for directors.
