Salary vs dividends calculator

Free tool

Tax year

6 April to 5 April. The company's year is taken as 1 April to 31 March alongside it.

Company profit before your salary

The year's profit after all other costs, before paying yourself. For example, 60,000.

Are you the company's only employee paid over £5,000 a year?

Answer yes for a one-person company. If someone else is paid over that, the company can claim the Employment Allowance.

Yes No

Your other income (optional)

Taxable income from outside this company for the tax year, such as another job, a pension or rent.

A salary to compare (optional)

Leave blank to see the best mix and the usual salary levels.

Do you pay Scottish Income Tax? (optional)

Yes if your main home is in Scotland. Dividends are taxed at UK rates either way.

Yes No

Associated companies (optional)

Other companies under the same control. Leave blank if none.

For a limited company with one owner who is also its director. General information, not tax advice.

Example

Worked example

Tax year: 2026-27; Company profit: £60,000; Director is the only employee: yes. Enter your own details to replace this example.

For 2026/27, with £60,000 of company profit, the best mix, to within £1, is a £12,570 salary plus £37,498.54 of dividends. You keep £46,091.20 after £13,908.80 of Corporation Tax, National Insurance, Income Tax and dividend tax: £561.59 more than a £6,708 salary.

Best option: £12,570 salary plus £37,498.54 of dividends
Your take-home pay: £46,091.20
Salary: £12,570.00
Dividends: £37,498.54
Corporation Tax: £8,795.96
Employer National Insurance: £1,135.50
Employee National Insurance: £0.00
Income Tax on the salary: £0.00
Dividend tax: £3,977.34
Total tax: £13,908.80
Next best: £6,708 salary: £45,529.61 take-home

Every option compared

Salary and dividend options for 2026/27, with the tax on each and the take-home pay
Option	Dividends	Total tax	Take-home
No salary all dividends	£47,850.00	£15,888.85	£44,111.15
£5,000 salary no employer National Insurance	£44,175.00	£14,706.29	£45,293.71
£6,708 salary the year counts for State Pension	£42,731.31	£14,470.39	£45,529.61
£12,570 salary (best) the personal allowance: no Income Tax or employee National Insurance	£37,498.54	£13,908.80	£46,091.20

Total tax is Corporation Tax, employer and employee National Insurance, Income Tax on the salary and dividend tax. Take-home plus total tax equals the company's profit.

We assume the company's year runs 1 April to 31 March alongside the tax year, that everything left after Corporation Tax is paid out as dividends, and that the director owns all the shares.
A company whose only employee paid over £5,000 a year is its sole director can't claim the Employment Allowance, so employer National Insurance is 15% of salary above £5,000.
A salary of at least £6,708 (the lower earnings limit for 2026/27) counts towards your State Pension, with no National Insurance to pay below £12,570.
Only the extra tax that the salary and dividends cause is counted, not the tax on your other income alone. National Insurance on another job is separate.
Income Tax uses the rates for England, Wales and Northern Ireland (Wales has the same rates). Scottish taxpayers should answer yes to the Scotland question.
Dividends can only be paid out of profits available for distribution, and a salary needs a PAYE payroll. This leaves out pension contributions, student loans, benefits in kind and the High Income Child Benefit Charge.
We searched every salary the profit can pay, to the penny: none leaves you £1 or more above a £12,570 salary. A salary a few pence away can leave a few pence more, because each tax is rounded to the penny, so we show the usual level.

Sources: HMRC: Income Tax rates and allowances for current and previous tax years GOV.UK: Tax on dividends HMRC: Rates and thresholds for employers 2026 to 2027 HMRC: CA44 National Insurance for company directors GOV.UK: Employment Allowance, check if you're eligible GOV.UK: Corporation Tax rates and reliefs GOV.UK: Taking money out of a limited company HMRC: Income Tax changes to tax rates for property, savings and dividend income (dividend rates from April 2026)