Tool updated with 2026 to 2027 tax year rates

HM Revenue & Customs updated its tool for checking how much tax is payable on dividends and savings interest with the new rates for the 2026 to 2027 tax year on 6 April 2026¹. The same update was applied to the department's tax code checker on the same date², and the published tables of Income Tax rates, allowances and bands were also refreshed for 2026 to 2027³.

The dividend and interest tool is for people who want to check whether they owe tax on dividend income or savings interest and to see how that tax is worked out¹. It cannot be used by anyone who files a Self Assessment tax return, receives any foreign income, or gets Marriage Allowance or Blind Person's Allowance¹. Users need tax code 1257L, and must know details of any income from employment or a pension for the tax year being checked, as well as whether they receive any taxable state benefits¹.

The separate tax code checker, first published on 25 July 2023, lets users find out what the letters and numbers in their tax code mean, see how much Income Tax they are due to pay, update their records if something is wrong, and understand the deductions included in the code². To use it, people need their tax code, annual income before deductions, company benefits details and State Pension amount². HMRC said a section was added in September 2025 to advise what information the tool will provide, alongside new tax code functionality².

The rates and allowances publication covers all Income Tax rates, allowances and bands for the current and previous three tax years, and also points to historical and future rates announced in earlier budgets or financial statements³. HMRC said rates, allowances and duties had been updated for 2026 to 2027³.

The 2026 to 2027 tax year began on 6 April 2026, when new tax rates and allowances came into force⁴. The same date was the first day on which a 2025 to 2026 tax return could be filed by someone holding all the information needed⁴.

Why it matters for households

The update means the figures the tool produces for dividend and savings interest now reflect the 2026 to 2027 tax year rather than the previous year¹. Anyone checking their position on savings interest or dividends from 6 April 2026 is working with the current year's rates, provided they meet the tool's conditions: no Self Assessment return, no foreign income, no Marriage Allowance and no Blind Person's Allowance, and a tax code of 1257L¹.

For savers and investors more broadly, the start of the tax year reset allowances. The annual ISA allowance remains at £20,000 for 2026/27, and the Junior ISA allowance is £9,000 per child⁵. The dividend allowance stands at £500, and dividend tax rates rose from 6 April 2026, from 8.75% to 10.75% for basic rate taxpayers and from 33.75% to 35.75% for higher rate taxpayers, with the additional rate unchanged at 39.35%⁵. The annual capital gains tax allowance is £3,000⁵. Pension contributions of up to £60,000 a year, or total earnings if lower, can receive tax relief, with unused allowances from the previous three tax years potentially available to carry forward⁵.

One change has been reported for a later year: from 6 April 2027, the annual cash ISA allowance for individuals under 65 is to be reduced to £12,000, with the remaining £8,000 of the £20,000 total ISA allowance to be used for stocks and shares or innovative finance ISAs⁵. The sources do not set out the full 2026 to 2027 Income Tax rates and bands themselves; those are published in HMRC's rates and allowances tables³.

What happens next

Self Assessment deadlines for the 2025 to 2026 return fall on 31 July 2026 for a second payment on account, 5 October 2026 to register for Self Assessment for the first time, 31 October 2026 for paper returns, 30 December 2026 to opt into PAYE collection for bills under £3,000, and 31 January 2027 for online returns and the first payment on account⁴. Late filing can attract a £100 penalty from one day late, rising with further charges after three, six and twelve months⁴. Late payment interest is set at the Bank of England base rate plus 2.5%⁴.