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Useful next calculations
Rates & sources2026/27
2026/27 illustrative director-extraction model. It uses standard employer and employee National Insurance, Corporation Tax rates and dividend rates, but cannot assess company-law or personal-tax facts.
| Band / figure | Rate |
|---|---|
| Employer NI | 15% above £5,000 |
| Corporation Tax | 19% small profits · 25% main rate |
| Dividend Allowance | £500 |
| Employment Allowance | not modelled |
Source: GOV.UK — Corporation Tax rates and allowances — source checked for 2026/27.
When to use this calculator
- Before pricing a job, setting margin targets or reviewing hiring costs.
- When you want to test sensitivity around volume, tax, markup or overheads.
- When you need a practical estimate before committing to a budget or proposal.
- When you are modelling break-even volume as costs or prices change.
Worked example: £80k profit, £12,570 salary, dividends from rest
Use these sample inputs as a quick scenario test, then change one variable at a time to compare outcomes.
| Input | Value |
|---|---|
| Profit | £80,000 |
| Less salary (£12,570) | £67,430 |
| Employer NI above £5,000 | £1,136 |
| Taxable company profit | £66,295 |
| Corp Tax (Marginal Relief) | £13,818 |
| Dividend pool | £52,476 |
| Personal tax on salary (covered by PA) | £0 |
| Salary NI (below threshold) | £0 |
| Dividend tax (basic + higher band) | £9,157 |
| Director take-home | £55,890 |
| Total tax (employer NI + CT + dividend) | £24,110 |
This scenario’s combined company and personal tax is about 30.1% of the £80,000 profit before extraction. It is not a recommendation for a salary level or dividend declaration.
How to read your results
Dividend Pool
The figure produced by this output for the inputs you entered. Change one variable at a time if you want to see what drives it.
Employer NI
The figure produced by this output for the inputs you entered. Change one variable at a time if you want to see what drives it.
Take-Home
The figure produced by this output for the inputs you entered. Change one variable at a time if you want to see what drives it.
Total Tax
Review this figure alongside your gross income so you can understand deductions before the tax year closes. It is a planning estimate, not a filed return.
Method & assumptionsAuthoritative sources
This 2026/27 scenario model starts with company profit before the chosen director salary and employer National Insurance. It deducts standard employer Class 1 National Insurance at 15% above the £5,000 annual Secondary Threshold, estimates Corporation Tax using the small-profits, marginal-relief and main-rate framework, then estimates the director’s Income Tax, employee National Insurance and Dividend Tax. It does not run a separate salary-only scenario.
The result assumes one England, Wales or Northern Ireland director-shareholder, no other income and an annual approximation. It excludes the Employment Allowance, associated-company limits, payroll timing and category letters, pension contributions, benefits, expenses, shareholder rights, retained-profit history and Scottish rates. Treat it as an illustrative comparison only; obtain professional company and tax advice before declaring dividends or changing payroll.
Common mistakes
- !Using optimistic assumptions without testing a more cautious scenario.
- !Using revenue in place of gross profit when calculating margin.
- !Treating the result as a final quote instead of a planning estimate.
- !Forgetting employer on-costs when modelling the true cost of a hire.
What to do next
- Try at least one more scenario so you can compare a realistic range.
- Use the related calculators below to cross-check the decision from another angle.
- Write down the key outputs from your best scenarios before you decide.
- If the result surprises you, change one input at a time to isolate the driver.
Frequently asked
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