Are these the best yielding dividend stocks in the UK?

What makes a good dividend stock?

A high yield is the starting point, not the conclusion. The most important question is whether the yield is sustainable — and whether the company generating it is financially strong enough to maintain or grow its dividend over time.

The FTSE 100 has historically been one of the most generous dividend-paying indices in the world, with a culture of cash returns embedded in sectors like financials, energy, consumer staples, and real estate. The index is forecast to pay a record £88 billion in dividends in 2026, with just 10 companies accounting for 52% of that total.

But dividend stocks require scrutiny beyond the headline yield. A high yield can reflect two very different things: either a company generating strong, sustainable cash flows and rewarding shareholders generously — or a company whose share price has fallen sharply, mechanically pushing the yield higher regardless of the underlying health of the business. Both types appear on any yield-ranked list. Distinguishing between them is the core skill of dividend investing. For more on how to evaluate income stocks, see our guides on how to invest in dividend stocks and fundamental analysis.

If you are ready to get started, you can open a share dealing account or stocks and shares ISA with us today — UK shares are available from £3 commission per trade.

Key metrics to understand before investing

Dividend yield is the annual dividend per share expressed as a percentage of the current share price. It changes daily as the share price moves. A 7% yield on a share that has fallen 40% in a year is a very different proposition to a 7% yield on a share that has been stable for five years.

Dividend cover measures how many times over a company can afford its dividend from earnings. For most companies, earnings per share divided by dividend per share gives the cover ratio. A ratio above 2x is considered comfortable; below 1.5x warrants scrutiny. For REITs, funds from operations (FFO) or adjusted FFO is the relevant measure rather than reported EPS, since depreciation distorts reported earnings for property companies.

Dividend growth — companies that have grown their dividend consistently over many years demonstrate both the financial capacity and the management commitment to reward shareholders. A 5% annual dividend growth rate sustained over ten years more than doubles the income stream for a long-term holder.

Payout ratio is the percentage of earnings paid as dividends. A payout ratio consistently above 80% suggests the company is paying out a large proportion of earnings with limited buffer for unexpected costs or earnings weakness.

Balance sheet strength — dividend-paying companies with high debt loads are more vulnerable to dividend cuts in downturns. Net debt to EBITDA and interest cover ratios are the key metrics to assess alongside the headline yield.

For guidance on how dividend income is taxed in the UK — including the £500 dividend allowance and the rates that apply above it — see our shares tax guide and capital gains tax guide. Holding dividend stocks within a stocks and shares ISA shelters all income and gains from tax entirely.

These FTSE 100 dividend stocks offer high yields, but with varying levels of cover and risk. Dividend payouts are only one part of an investment case. Past performance is not a guarantee of future results. Always conduct your own research, as the value of your investment can go down as well as up.

Ten highest-yielding FTSE 100 dividend stocks: July 2026

Yields and market capitalisation data sourced from dividenddata.co.uk, ranked by annual yield as of late June 2026. All yields are prospective — they reflect what companies have recently paid, not what they are guaranteed to pay in future. Dividends are never guaranteed and can be cut at any time.

Legal & General (LGEN) — 7.59%

Legal & General is the highest-yielding stock in the FTSE 100 and has held that position consistently throughout 2026. It is one of the UK's largest financial services companies, with a market capitalisation of approximately £15.9 billion, operating across life insurance, asset management, and retirement solutions for both institutional and retail customers.

For full year 2025, L&G reported core operating profit of £1.62 billion, up 6%, and core EPS of 20.93p — at the top of its stated 6-9% annual growth guidance. The full-year dividend was raised 2% to 21.79p per share, covered approximately 1.2x by Solvency II operating capital generation of 26.78p per share. The next interim dividend has an ex-dividend date of 20 August 2026 and a payment date of 25 September 2026. Management is guiding approximately 2% DPS growth in 2026 and has announced a £1.2 billion share buyback running alongside the dividend.

The yield has moved from 8.15% in May to 7.59% today, reflecting a partial share price recovery — a positive signal for existing holders. The Solvency II coverage ratio of 210% remains the key metric to monitor for dividend sustainability, having declined from 232% in the prior year. For income investors, L&G offers the highest yield in the index, a 16-year consecutive dividend growth streak, and strong management guidance on continued EPS growth as the core investment case.

Standard Life (SDLF) — 6.66%

Standard Life is a well-established UK-based life insurance and pensions group with a market capitalisation of approximately £8.4 billion, operating across retirement savings, income drawdown, and workplace pensions. The current forward yield of 6.66% reflects a semi-annual payment structure. The most recent dividend of 28.05p per share was paid on 20 May 2026.

Standard Life's dividend sustainability depends primarily on its Solvency II capital ratio and the performance of its investment portfolio. Like Legal & General, it is structurally sensitive to interest rate movements — the sector has benefited from elevated rates through higher reinvestment yields, but as rates fall further that tailwind moderates. The dividend has been stable and growing with no cuts in recent years, making it a credible high-yield position within the defensive life insurance sector.

Londonmetric Property (LMP) — 6.58%

Londonmetric Property is a FTSE 100 REIT focused on logistics, healthcare, convenience, entertainment, and leisure real estate across the UK, with a market capitalisation of approximately £4.4 billion. Its portfolio is structured predominantly as triple net leases, where tenants bear most property costs, providing unusually clean and predictable income for the landlord.

Of the ten names on this list, Londonmetric arguably has the most straightforward dividend sustainability case. The payout ratio is approximately 61% relative to earnings and 82% on a cash basis — meaningfully better coverage than several peers. The company has a 10-year track record of growing dividends, with annual DPS growth of 17.6% to 12.0p per share for 2025. Dividends are paid quarterly with a scrip alternative available. In October 2025, Londonmetric completed the £925 million acquisition of Urban Logistics REIT, adding a high-quality logistics portfolio that further strengthens its income base. For investors interested in listed property as an income vehicle, see our guide on alternative investments.

Land Securities (LAND) — 6.27%

Land Securities is the UK's largest listed commercial property company and one of the longest-established REITs in the FTSE 100, with a market capitalisation of approximately £4.9 billion. Its portfolio spans retail destinations, London offices, and mixed-use urban developments. As a REIT, it is required to distribute at least 90% of taxable income to shareholders, which structurally supports high and consistent payouts.

The yield has compressed from 6.67% in May to 6.27% today as the share price has recovered — Land Securities has been one of the stronger performers in the property sector in recent weeks as interest rate cut expectations have strengthened. As the Bank of England continues cutting from its 3.75% base rate, property REITs of this quality typically attract renewed income investor interest. Land Securities' scale, asset quality, and long track record make it one of the more defensible high-yield positions in the index.

Investec (INVP) — 6.19%

Investec enters the top ten with a yield of 6.19% and a market capitalisation of approximately £4.0 billion. It is a specialist banking and asset management group with operations across the UK, South Africa, and internationally, operating across private banking, wealth and investment management, and corporate and institutional banking — a diversified financial services model that is somewhat different in character to the life insurance and REIT names that typically dominate this list.

Investec has a history of progressive dividend payments and its diversified business model provides some insulation against single-sector stress. The South African exposure does introduce currency and emerging market risk that pure UK-listed peers do not carry — a consideration for UK income investors building a concentrated domestic dividend portfolio. Cover is supported by strong private banking revenue growth and improving asset management margins. As a new entrant to the top ten, it is worth monitoring whether the yield holds at current levels or compresses further as the market catches up with its income credentials.

M&G (MNG) — 6.12%

M&G is a diversified asset manager and savings provider with a market capitalisation of approximately £8.1 billion and a broad retail customer base across savings, investments, and insurance. It has been a consistent high yielder in the FTSE 100 and sits comfortably in the top ten at 6.12%. Its dividend sustainability depends on continued growth in assets under management and fee income — both of which are sensitive to broader market conditions and investor risk appetite. M&G has a strong history of dividend payments and has been actively managing its capital position to support distributions. For investors looking for financial sector income with a broader business mix than pure life insurance, M&G is worth considering alongside Aviva and Standard Life.

Aviva (AV.) — 6.08%

Aviva is the UK's largest composite insurer, with a market capitalisation of approximately £19.4 billion, operating across life insurance, general insurance, and asset management. It offers a well-covered dividend with strong capital generation — its Solvency II capital ratio is robust — and has been actively returning capital to shareholders through both dividends and buybacks in 2025 and 2026. At 6.08%, it offers the largest absolute market cap of any name on this list, which brings with it greater liquidity and institutional support. For income investors who want life insurance sector exposure with a broader business mix and larger market capitalisation than LGEN or SDLF, Aviva is the natural alternative. You can invest in Aviva and other FTSE 100 income stocks through our share dealing account or ISA.

Aberdeen Group (ABDN) — 6.07%

Aberdeen Group is a global investment company with a market capitalisation of approximately £4.4 billion, operating across asset management, wealth management, and investment platforms across the UK and internationally. The 6.07% yield reflects a dividend that has remained at elevated levels even as the share price has faced persistent pressure — Aberdeen has experienced significant net outflows from its asset management business in recent years as investors have shifted towards passive funds and competing active managers. The dividend cover warrants close scrutiny given the earnings pressure from outflows. Management has maintained its commitment to the dividend and has been undertaking cost reduction and strategic repositioning, but the sustainability of the payout relative to earnings is the key variable to watch before investing. Aberdeen is a differentiated income story from the insurers and REITs on this list — higher risk but with a specific strategic transformation angle.

Imperial Brands (IMB) — 5.91%

Imperial Brands is one of the world's largest tobacco companies, with a market capitalisation of approximately £21.3 billion, manufacturing brands including Davidoff, blu, and Winston. Tobacco stocks have historically been amongst the most reliable income stocks in the FTSE 100 — high cash generation, low capital expenditure requirements, and management commitment to progressive dividends have sustained elevated yields through multiple market cycles. IMB has consistently grown its dividend and has strong free cash flow cover. The ex-dividend date for its next payment falls on 9 July 2026, with payment expected in August 2026. The sector risk is structural: long-term volume decline as smoking rates fall globally and regulatory pressure on tobacco products intensifies. However, the transition to next-generation products — vaping, heated tobacco, oral nicotine — provides a potential growth offset. For income investors comfortable with the sector, the 5.91% yield is well-covered and historically reliable.

Barratt Redrow (BTRW) — 5.82%

Barratt Redrow returns to the top ten at 5.82% — its yield has compressed from the 6.82% recorded in May as the share price has recovered somewhat. It is the UK's largest housebuilder by volume, with a market capitalisation of approximately £4.1 billion, formed through the merger of Barratt Developments and Redrow in October 2024.

The elevated yield still partly reflects a share price that has fallen significantly over the past year — down approximately 40% from its peak — rather than solely an exceptional absolute dividend payment. For the first half of 2026, the company reported revenue of £2.63 billion, up 15% year on year, with EPS rising from 7.2p to 7.6p. The interim dividend of 5.0p per share was paid on 15 May 2026. The next expected final dividend of 12.10p per share has an ex-dividend date of 9 October 2026 and a payment date of 13 November 2026. Management has committed to a dividend policy of 2.0x cover of adjusted EPS for the full year, which provides forward visibility on the payout.

Analysts forecast significant EPS growth of approximately 92% over the next three years as the Redrow integration delivers synergies and the UK housing market stabilises. The key risks remain mortgage rates, the planning environment, and build cost inflation. Investors should treat the yield as reflecting genuine execution risk in the near term rather than simply a generous income payment. For more context on how to evaluate individual stocks, see our how to pick stocks guide.

How to invest in UK dividend stocks with us

You can buy UK dividend stocks through our share dealing account or stocks and shares ISA. Holding dividend stocks within an ISA means all income received is sheltered from UK income tax, and any capital gains on eventual sale are free from CGT — up to the annual £20,000 ISA allowance. You can also hold UK dividend stocks within a SIPP for tax-efficient retirement income — particularly useful for income investors building a long-term portfolio.

If you prefer to trade on price movements of individual FTSE 100 stocks without owning shares outright, spread bets and CFDs are available. Note that leveraged products are not suited to long-term income strategies — dividends on spread bet and CFD positions are handled differently to direct share ownership. For a full explanation of the tax differences between spread betting and share dealing, see our spread betting vs CFDs tax guide.

With us, UK shares are available from £3 commission per trade online. US shares are £0 commission online.

For broader context on dividend investing, see our guides on how to invest in dividend stocks, what is dividend yield, our regularly updated FTSE 100 top five dividend stocks article, and our monthly dividend stocks article for US income opportunities.

Past performance is not a reliable indicator of future results. The value of investments can fall as well as rise and you may get back less than you invest. Dividends are not guaranteed.