Dividend Vs. Salary Calculator
Find the most tax-efficient split between salary and dividends for your limited company. Compare your net take-home across three strategies.
Pay yourself a full salary. Pensionable and builds your NI record, but carries the highest income tax and NI burden.
Low salary at the NI secondary threshold (£9,100) plus dividends. The classic director strategy for minimising tax.
No salary, all dividends. No NI contributions or auto-enrolment, but you lose the benefit of your personal allowance against earned income.
Results
Calculating…
2025/26 tax year · Personal Allowance £12,570 · Basic rate 20% (£12,571–£50,270) · Higher rate 40% (£50,271–£125,140) · Dividend Allowance £500 · Dividend tax: 8.75% basic / 33.75% higher / 39.35% additional · Corporation Tax 19% (profits ≤£50k) or 25% (profits >£250k) with marginal relief between · Employer NI 15% above secondary threshold (£5,000) · Employment Allowance £10,500 · Employee NI 8% (£12,570–£50,270), 2% above · Strategy B salary = £9,100 (above lower earnings limit, below secondary threshold) · Does not account for pension contributions, salary sacrifice, or VAT. Figures rounded to nearest £.
This calculator is for illustrative purposes only and does not constitute financial or tax advice. Tax rules are complex and individual circumstances vary. Always consult a qualified accountant or tax adviser.