UK Contractor Take-Home Calculator

From day rate to take-home

Your day rate is not your take-home. What you actually keep depends on how many days you bill, your costs, your IR35 status, and where in the UK you pay tax. This calculator turns a day rate and a number of billable days into an estimated annual take-home for the 2026/27 tax year.

Outside IR35: salary plus dividends

Working outside IR35 through your own limited company, the tax-efficient approach is a small director's salary - commonly £12,570, which sits at both the Personal Allowance and the National Insurance Primary Threshold, so it carries no Income Tax and no employee NI - plus dividends drawn from profit after Corporation Tax. Corporation Tax is 19% on profits up to £50,000, 25% above £250,000, and tapered by Marginal Relief in between. Dividends are then taxed at 10.75% / 35.75% / 39.35% for 2026/27 after a £500 dividend allowance.

Inside IR35: taxed like employment

Inside IR35, the engagement is treated as employment: Income Tax and employee National Insurance come off through PAYE, and the salary-plus- dividends structure is not available. Take-home is materially lower, which is why contractors often seek a higher day rate for inside-IR35 work. The assignment rate also has to cover employer NI before your gross pay (the calculator deducts this); it excludes any umbrella margin and the apprenticeship levy.

England/Wales/NI vs Scotland

Scotland sets its own income tax bands - six of them for 2026/27, from a 19% starter rate up to a 48% top rate - which apply to salary and other non-dividend income. Dividend tax rates are the same across the UK. The Personal Allowance (£12,570, tapered away above £100,000) is UK-wide.

Heads-up for 2026/27: dividend tax rates rise from 6 April 2026 (basic to 10.75%, higher to 35.75%), so a limited-company contractor's take-home will fall slightly next tax year.