How next April's tax changes hit your savings and rent
From 6 April 2027, tax on savings interest and rent goes up by 2p in the pound. Enter your income and we'll show what it costs you on the same income, and what softens it.
Your answer
Enter your pay and pensions, and any savings interest, rent or dividends.
About this calculator
For individuals. We work out your income tax on the same income in 2026/27 and in 2027/28, and show the difference on your savings, rent and dividends.
The new rates are set by Finance Act 2026. Tax on pay and pensions isn't changing.
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We don’t keep them. Your answers go to our server to do the sums and aren’t stored or logged. If you copy a link to your answers, they’re in the link itself, so only share it with people you trust.
How it’s worked out
From 6 April 2027, savings interest above your tax-free amounts is taxed at 22%, 42% or 47% instead of 20%, 40% or 45%. Rental profit is taxed at the new property rates, 22%, 42% or 47%, in England, Wales and Northern Ireland, and relief on mortgage interest rises from 20% to 22%. Dividend rates went up in April 2026 (10.75% and 35.75%) and don't change again.
Your income is taxed in this order: pay and pensions, then rent, then interest, then dividends, and the tax-free allowance comes off in the same order. The £5,000 starting rate for savings, the tax-free interest allowance (£1,000, £500 or nothing) and the £500 of tax-free dividends don't change. Allowances and bands are frozen until 2031.
In Scotland, rent stays on the Scottish rates until Scotland sets its own rates for rent, so only the savings change and the higher mortgage interest relief apply. We hold today's Scottish rates. We don't count pension payments, Gift Aid, losses or the £1,000 property allowance. Every figure is checked a second way before you see it.
Worked example
From 6 April 2027, the tax on your savings, rent and dividends goes from £4,482 to £4,692 a year: £210 more.
England · same income in 2026/27 and 2027/28 · today's allowances and bands
| Your income a year: pay and pensions £45,000, rent £12,000, interest £3,000, dividends £2,000 | |
|---|---|
| Order taxed: pay and pensions, then rent, then interest, then dividends. The tax-free allowance comes off in the same order. | |
| Tax-free allowance | £12,570 |
| 2026/27 (now) | |
| Tax on rent at 20% / 40% / 45% | £3,746 |
| Less mortgage interest relief: 20% of £4,000 | − £800 |
| Tax on interest: £500 tax-free, the rest at 20% / 40% / 45% | £1,000 |
| Tax on dividends: £500 tax-free, the rest at 10.75% / 35.75% / 39.35% | £536 |
| Tax on savings, rent and dividends, 2026/27 | £4,482 |
| 2027/28 (from 6 April 2027) | |
| Tax on rent at 22% / 42% / 47% | £3,986 |
| Less mortgage interest relief: 22% of £4,000 | − £880 |
| Tax on interest: £500 tax-free, the rest at 22% / 42% / 47% | £1,050 |
| Tax on dividends: £500 tax-free, the rest at 10.75% / 35.75% / 39.35% | £536 |
| Tax on savings, rent and dividends, 2027/28 | £4,692 |
| Tax on your pay and pensions on their own: £6,486 in both years | |
| Extra tax a year | £210 |
Worked out with HMRC's rates for 2026/27 and the rates set by Finance Act 2026 for 2027/28, on the same income.
Questions people ask
Does this apply in Scotland?
The higher savings rates apply across the UK. The new rates on rent apply in England, Wales and Northern Ireland. In Scotland, rent stays on the Scottish rates until the Scottish Parliament is given its own power to set rates for rent.
Will my dividends be taxed more from April 2027?
No. Dividend tax went up 2p in the pound from 6 April 2026, to 10.75% and 35.75%. The top rate stays at 39.35%, and nothing changes in April 2027.
How can I soften the rise?
Interest in an ISA is tax-free. Paying into a pension can bring your savings and rent into a lower band. Couples can hold savings in the name of the one who pays less tax. Talk to us before moving property into a company, as Stamp Duty and Capital Gains Tax can apply.
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