Example result based on the prefilled values.
Dividend Pool
£52,476.46
Employer NI
£1,135.50
Take-Home
£55,889.88
Total Tax
£24,110.12
Continue your plan
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.
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, VAT, markup, or overhead changes.
- When you need a practical estimate before committing to a budget or proposal.
- When you are modelling break-even volume and want to see how it shifts as overheads or prices change.
- When you are preparing a quote and need to verify that the margin holds after materials, labour, and VAT are accounted for.
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.
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
Use this metric to compare scenarios side by side and understand how changes in the key inputs drive the final outcome. If the figure surprises you, isolate one variable at a time and rerun the calculation to identify which assumption is responsible.
Employer NI
Use this metric to compare scenarios side by side and understand how changes in the key inputs drive the final outcome. If the figure surprises you, isolate one variable at a time and rerun the calculation to identify which assumption is responsible.
Take-Home
Use this metric to compare scenarios side by side and understand how changes in the key inputs drive the final outcome. If the figure surprises you, isolate one variable at a time and rerun the calculation to identify which assumption is responsible.
Total Tax
Review this figure alongside your gross income so you can understand the true cost of deductions and plan around any thresholds before the tax year closes. If the figure looks higher than expected, check whether any pension or gift-aid contributions could reduce your taxable income.
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 as well.
- !Comparing outputs from different tools without checking that the inputs match.
- !Treating the result as a final quote instead of a planning estimate.
- !Forgetting to include employer National Insurance contributions when modelling the true cost of a new hire.
- !Using revenue figures in place of gross profit when calculating margin percentage, which produces a misleadingly high result.
What to do next
- Try at least one more scenario with a lower price or higher cost so you can see the margin floor.
- Use the related calculators below to cross-check VAT, payroll, or break-even figures from another angle.
- Open one of the linked guides if you need more context before you finalise a quote or budget.
- If the margin is tighter than expected, identify which single input has the biggest impact and focus any negotiation there first.
- Keep a record of the assumptions behind this estimate so you can revisit and update it when costs or volumes change.
Frequently asked
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