IR35 calculator 2026/27
Same day rate, two worlds: inside IR35 you are paid through PAYE (usually an umbrella); outside IR35 you invoice through your limited company and take salary plus dividends. See the yearly difference.
Outside IR35 the company pays corporation tax on profit, then you pay dividend tax personally. Inside IR35 the umbrella deducts employer NI and the apprenticeship levy from the rate before your PAYE.
| Inside IR35 (umbrella) | Outside IR35 (Ltd) | |
|---|---|---|
| Invoiced (rate × days) | ||
| Umbrella margin / company costs | ||
| Employer NI + levy | ||
| Pension (company) | – | |
| Corporation tax | – | |
| Income tax | ||
| Employee NI | ||
| Dividend tax | – | |
| Take-home per year | ||
| Take-home per month | ||
| Kept, as % of invoiced |
Read: umbrella vs limited company →
What this compares
Inside IR35 means the engagement is treated as employment for tax. In the private sector the client decides (since April 2021) and you are normally paid via an umbrella company: the umbrella's margin, employer NI at 15% and the 0.5% apprenticeship levy come out of the assignment rate, then income tax and employee NI are deducted like any employee. Outside IR35 means your limited company invoices the client; it pays corporation tax (19% up to £50,000 profit, tapering to 25% at £250,000) and you draw a small salary plus dividends taxed at the 2026/27 dividend rates. Holiday pay, sick pay and pension auto-enrolment inside IR35 are ignored here; so is the £5,000 employer NI secondary threshold effect on a salary above it (included in the outside column). Status is a legal question — the calculator only shows the money.
Assumes England/Wales/NI bands, no other income, no student loan, pension only where entered, and that all post-tax profit is drawn as dividends in the same year. Not tax advice.
Frequently asked questions
What does inside IR35 mean?
The engagement is treated as employment for tax: income tax and National Insurance are deducted through PAYE, usually by an umbrella company, and employer NI plus the apprenticeship levy come out of the assignment rate.
Who decides my IR35 status?
For medium and large private-sector clients and all public bodies, the client decides and issues a Status Determination Statement. Only small clients leave the decision with the contractor's company.
How much less do I take home inside IR35?
Typically 15–25% of the invoiced amount, depending on the rate: the calculator shows the yearly figures side by side for your day rate.
Can I claim expenses inside IR35?
Very few. Travel and subsistence to a regular workplace are not allowable for inside-IR35 workers; pension contributions via salary sacrifice through the umbrella are the main lever.