Salary vs Dividend Tax Calculator
Compare the estimated tax and National Insurance consequences of taking money from a UK limited company as salary or dividends.
1. How much do you want to take from the company?
The calculator compares the same £ amount as gross salary
and dividend.
Dividends generally require sufficient distributable profits.
2. Your personal tax position
Include existing salary, pension, property income and other
taxable non-dividend income.
The calculator automatically considers the £100,000
Personal Allowance taper.
Student loans, pension salary sacrifice, benefits in kind,
Marriage Allowance, blind person’s allowance and unusual tax
circumstances are not included in this calculator.
3. Company / employer position
A company with only one director who is the sole employee
liable for secondary Class 1 NIC may not qualify.
Salary and employer National Insurance may normally be deductible
company expenses. Dividends are paid from post-tax distributable
profits and are not normally deductible for Corporation Tax.
Important assumptions
- Tax year: 2026/27.
- Salary is treated as gross employment income.
- Dividend is treated as a cash dividend of the same amount.
- The £500 dividend allowance is taken into account.
- Dividend income is stacked on top of the individual’s other taxable income.
- Director National Insurance is calculated using annual thresholds.
- Employer National Insurance is included in the company-side salary comparison.
- Employment Allowance can reduce employer National Insurance where the company is eligible and allowance remains.
- Dividend availability is checked against the distributable reserves entered by the user.
- The dividend option assumes the available reserves have already suffered any applicable Corporation Tax.
- This is an estimation and planning tool rather than a replacement for a tax return or professional tax advice.
Rates and thresholds should be checked against the latest
HMRC/GOV.UK legislation before relying on the result for an actual
tax planning decision.