Enter company profit and a director salary to see exactly what the salary costs the company (employer NI), what comes out in tax and NI personally, and what remains available for dividends.
Updated for 2026/27. Uses UK corporation tax, dividend tax and PAYE assumptions. Estimates only — not tax advice.
Calculate company tax Read the guidesDirector salary calculator 2026/27: see the true cost of £5,000 vs £12,570 salary, employer NI, income tax saved, corporation tax impact and net take-home effect.
Updated for 2026/27. Written and reviewed by James Whitfield against current GOV.UK and HMRC guidance · Editorial standards · Methodology. Estimates for planning only — not tax, accounting or financial advice.
Figures reviewed for the 2026/27 tax year (last updated July 2026). Source: GOV.UK.
Most directors pay themselves a small salary and take the rest as dividends, but the exact salary level changes your total tax bill. This tests the standard director salary levels against your profit figure and shows which keeps the most in your pocket. It uses the same engine as the calculator above, so every figure ties out.
| Director salary | Dividends | Corp tax | Personal tax | Take-home | vs best |
|---|---|---|---|---|---|
| £0 | £58,875 | £16,125 | £11,444 | £47,430 | −£6,097 |
| £5,000 | £55,200 | £14,800 | £10,130 | £50,069 | −£3,458 |
| £9,100 | £51,734 | £13,550 | £8,891 | £51,943 | −£1,585 |
| £12,570 ★ | £48,801 | £12,493 | £7,842 | £53,528 | — |
| £50,270 | £14,530 | £3,408 | £15,572 | £49,228 | −£4,299 |
Why £12,570 wins: Uses the full Personal Allowance; salary is corporation-tax deductible. Each option pays out all available post-tax profit as dividends. Change the company profit, region or pension in the calculator above to refresh these numbers.
Assumes the director has no other personal income unless entered above, and that the company can pay the salary. It does not model the £5,000 Employment Allowance (unavailable to most single-director companies), pension tapering or student loans. Estimates for planning only — not tax advice.
This calculator answers a narrower question than the salary-versus-dividend split: what should you actually set your director salary at? The realistic candidates for 2026/27 are £12,570 (the full Personal Allowance), £9,100, and £5,000 (the point at which employer National Insurance starts). It is about the salary level itself, before you decide anything about dividends.
For most single-director companies £12,570 usually wins. Salary is a deductible company expense, so every extra pound of salary reduces profit and therefore corporation tax at 19%, 25% or the 26.5% marginal rate. Above the £5,000 secondary threshold, employer NI of 15% does apply, but for the £5,000 to £12,570 slice the corporation tax saved on the larger deduction generally outweighs that NI cost, and you receive the whole amount tax-free because it sits within your Personal Allowance.
The main catch is the Employment Allowance. It would normally offset the first £10,500 of employer NI, but a company whose only employee is a single director generally cannot claim it. This tool assumes that position, so the employer NI above £5,000 shows as a genuine cost, and you can weigh a £12,570, £9,100 or £5,000 salary on a like-for-like basis.
A limited company must keep its finances separate from personal accounts. These accounts are free to open.
Companies House now charges £100 to register a limited company online (up from £50 in February 2026). Same-day digital registration is £156. You can register directly at gov.uk or through a formation agent.