Salary vs Dividend Calculator
How can your UK limited company provide you with the money you need at the lowest estimated tax cost?
1. How much do you need personally?
Enter the amount you actually want in your
personal hands after personal tax and
employee National Insurance.
Enter distributable reserves, not simply
the company’s bank balance.
2. Your personal tax position
Include existing salary, pension and other
taxable non-dividend income.
The calculator determines the relevant tax bands
automatically from your other taxable income.
You do not need to decide whether you are a
basic-rate or higher-rate taxpayer.
3. Company position
Employment Allowance has specific eligibility
conditions. A company with only one director who
is the only employee liable for secondary Class 1
NIC may not qualify.
How this calculator works
- Salary: The calculator works backwards from your desired net cash to calculate the gross salary required.
- It then adds employer National Insurance and considers any available Employment Allowance.
- The Corporation Tax deduction available for qualifying salary and employer NIC is then reflected in the estimated company economic cost.
- Dividend: The calculator works backwards from your desired net cash to calculate the gross dividend required after dividend tax.
- It then estimates the pre-Corporation-Tax profit required to leave enough post-tax profit to pay that dividend.
- The dividend requirement is compared with the distributable reserves entered above.