Salary vs Dividends Calculator
Find the best salary and dividend split for your limited company in 2026/27, with Corporation Tax, NI, dividend tax and take-home at every salary level.
Reviewed by Dany, RightSums team · Updated
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finance · Business · UK
Enter your company's profit before your pay and the salary you take, and the calculator works out employer NI, Corporation Tax with marginal relief, your Income Tax and NI, dividend tax at the 2026/27 rates of 10.75%, 35.75% and 39.35%, and what you take home. It then tries every salary from £0 up to what the profit can pay and shows the one that leaves you with the most, with a table at £5,000, £6,708, £12,570 and higher salaries. It compares salary only, dividends only and the best mix, and explains why Employment Allowance can move the best salary well above £12,570. You can add other income, Scottish tax rates, a company pension contribution, associated companies, profits kept from earlier years, and choose to take everything out, stop at the higher rate or take a set dividend. It warns you when a dividend is more than the company can lawfully pay. 2025/26 is available for comparison.
Accepted inputs
- Tax year: 2026/27 or 2025/26
- Company profit for the year before your salary, employer NI and pension
- Your salary, with buttons for £12,570, £6,708, £5,000 and the best salary
- Where you pay tax: England, Wales or Northern Ireland, or Scotland
- Whether the company can claim Employment Allowance (not a sole director with no other employee)
- How much profit to take out: all of it, dividends up to £50,270 of income, or a dividend you choose
- Your other income, such as a job elsewhere, rent or a pension
- Company pension contribution, associated companies and profits kept from earlier years
Outputs
- Take-home pay a year and a month
- Employer NI after any Employment Allowance, and employee NI
- Corporation Tax with the band, marginal relief and associated company limits
- Income Tax on your salary, including the extra tax it adds to other income
- Dividend tax split by the £500 allowance and the basic, higher and additional rates
- Total tax and NI and the effective rate on the profit
- The best salary for your figures and how much more it gives you
- A table of take-home at £0, £5,000, £6,708, £12,570 and higher salaries
- Salary only vs dividends only vs the best mix
- Best salary with and without Employment Allowance, with the reason
- Warnings for unlawful dividends, losses, the lower earnings limit and the £100,000 taper
How to use the Salary vs Dividends Calculator
- Enter your company's profit before your pay, your salary, the tax year and where you pay tax, then say whether the company can claim Employment Allowance.
- The calculator takes off your salary, 15% employer NI above £5,000 (less any Employment Allowance) and any pension contribution, then works out Corporation Tax at 19%, 25% or with marginal relief in between.
- The profit left after Corporation Tax is paid as dividends, all of it or as much as you choose. Your salary and other income use the Personal Allowance and tax bands first, then dividends are taxed above the £500 allowance at 10.75%, 35.75% or 39.35%.
- It repeats the sums for every salary from £0 up to what the profit can pay, shows the salary that leaves you with the most, and compares salary only, dividends only and the best mix.
Frequently asked questions
What is the best salary for a limited company director in 2026/27?
For most single-director companies the best salary is £12,570, with the rest of the profit paid as dividends. It uses the full Personal Allowance, so there is no Income Tax or employee NI on it, and it cuts Corporation Tax. On £60,000 of profit it leaves £46,091.20, against £44,111.15 with no salary.
What are the dividend tax rates for 2026/27?
From 6 April 2026 dividends are taxed at 10.75% in the basic rate band, 35.75% in the higher rate band and 39.35% in the additional rate band, according to GOV.UK. The first £500 is covered by the dividend allowance. The basic and higher rates were 8.75% and 33.75% in 2025/26.
Why does the calculator suggest a salary above £12,570?
It usually happens when the company can claim Employment Allowance, which covers up to £10,500 of employer NI. Salary up to £75,000 then costs the company no employer NI and saves Corporation Tax at 19% to 26.5%. On £100,000 of profit, a £75,000 salary takes home £67,246.77 against £65,745.85 at £12,570.
Can a sole director claim Employment Allowance?
No, if you are the company's only employee paid above the £5,000 secondary threshold. According to GOV.UK, when a company has one director, that director must not be the only employee liable for employer NI. Choose No in the calculator unless someone else is on the payroll above £5,000.
Is the take-home figure after Corporation Tax?
Yes, take-home is what reaches you after every tax: employer NI, Corporation Tax, employee NI, Income Tax on your salary and dividend tax. If you leave profit in the company, it is shown separately after Corporation Tax but before any dividend tax you will pay when you take it out later.
How does it handle Scotland?
Your salary and other income are taxed at Scottish rates, and your dividends at the same rates as the rest of the UK, as GOV.UK sets out. With a £12,570 salary and no other income the result matches England. With £30,000 of other income, the salary adds £2,639.70 of Scottish Income Tax against £2,514 in England.
Can I pay a dividend if my company made a loss?
Only from profits kept from earlier years. According to GOV.UK, a company must not pay out more in dividends than its available profits from current and previous financial years. Enter those profits under more options; the calculator caps dividends at what is available and warns you when you ask for more.
Sources
The rates and rules in this tool come from:
- GOV.UK: Corporation Tax rates, expenses and reliefs: Rates
- GOV.UK: Corporation Tax rates and allowances
- GOV.UK: Marginal Relief for Corporation Tax
- GOV.UK: CTM03925 - Small profits rate: financial year 2023 onwards: no associated companies…
- legislation.gov.uk: Corporation Tax Act 2010
- GOV.UK: Tax on dividends: Check if you have to pay tax on dividends
- GOV.UK: Income Tax rates and allowances for current and previous tax years
- GOV.UK: Income Tax in Scotland: Current rates
- GOV.UK: Rates and thresholds for employers 2026 to 2027
- GOV.UK: Rates and thresholds for employers 2025 to 2026
- GOV.UK: Employment Allowance: Check if you're eligible
- GOV.UK: National Insurance: introduction: Overview
- GOV.UK: NIM12001 - Class 1: Calculating Class 1 NICs for Directors: Introduction - HMRC…
- GOV.UK: Running a limited company: your responsibilities: Taking money out of a limited company
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