Tax Planning
Dividend, Savings & Trust-Income Tax Changes from 6 April 2026: What Investors Must Know
From April 2026, UK rates for dividends, savings, and trust income change—affecting small investors, landlords, and estate-holders alike.
By NomadicTax Research Team • 5-8 min read • March 18, 2026
## New Rates for 2026-27
From **6 April 2026**, Budget 2025 brings in changes to the way **dividend, savings and property income** are taxed, particularly in **trusts and estates**. Key changes include:
- The existing **8.75% dividend income rate** will rise to **10.75%** for 2026-27. ([gov.uk](https://www.gov.uk/government/publications/hm-revenue-and-customs-trusts-and-estates-newsletters/hmrc-trusts-and-estates-newsletter-february-2026?utm_source=openai))
- Higher rates for property/savings income and changes to trust/income tax for estates apply from **2027-28**. ([gov.uk](https://www.gov.uk/government/publications/changes-to-tax-rates-for-property-savings-and-dividend-income/change-to-tax-rates-for-property-savings-and-dividend-income-technical-note?utm_source=openai))
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## Who is Affected
- **Private investors and shareholders** who receive dividend income. Even modest portfolios may see higher tax bills on dividends above the allowance.
- **Landlords and savers** with property or savings income, especially trusts that receive multiple sources of passive income.
- **Beneficiaries of trusts and estate executors** who need to account for the new rules in reporting and returns.
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## Examples
- If you own shares that pay dividends totalling £2,000 in 2026-27, under the old rate (8.75%) you’d pay £175; under the new rate (10.75%), tax rises to **£215**, a £40 increase.
- A trust with savings interest income that falls into the higher band—its income may be taxed at **42%** or **47%** in later years once those changes take effect.
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## Strategies to Manage Tax Impacts
1. **Max out allowances**: use your annual dividend allowance (still £500) and personal savings allowance where applicable.
2. **Structure income timing**: bring forward or defer dividend payments depending on personal income level to stay in lower band.
3. **Consider trust structures carefully**: redistribution of income, or trustees paying beneficiaries instead of holding income in a trust carved at higher rates.
4. **Tax planning**: use pension contributions, ISAs, Enterprise Investment Schemes (EIS), or other relief-giving vehicles to shelter income.
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## Compliance Tips
- Ensure your tax return accurately separates income into **dividend**, **property/savings**, and **other income** sources.
- For trusts, track distributions and accumulations precisely, and report on Self Assessment in the year of distribution.
- Keep good records of all income sources and any tax withheld or paid.
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## Conclusion
With the April 2026 tax year changes, even modest changes in rates can turn into meaningful extra tax for many investors and trust beneficiaries. Understanding where your income falls and adapting your income flows and structure now can help you avoid surprise bills and preserve more of your returns.