IR35 Calculator 2025/26
Compare your take-home pay inside IR35, outside IR35 (limited company), and via an umbrella company — based on your day rate or annual contract value.
Your Contract Details
£
£0£1,500
100260
Typical: 220 days (5 days/week × 44 weeks, allowing for holidays and gaps)
£
£0£300k
£
£0£20k
Outside IR35 only — travel, equipment, training, accountancy etc.
£
£0£30k
Outside IR35 only — paid by your Ltd company, fully deductible before CT
The umbrella deducts this before calculating your PAYE. Typical range: £20–£35/week.
Take-Home Pay Comparison
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Option A
Outside IR35
Limited Company
Limited Company
Gross contract—
Business expenses—
Salary (£9,100)−£9,100
Employer NI (on salary)—
Employer pension—
Corporation Tax—
Income Tax (salary)—
Employee NI (salary)—
Dividend Tax—
Take-home
—
—
Effective rate: —
Option B
Inside IR35
Deemed employment
Deemed employment
Gross contract—
Employer NI (15%)—
Deemed salary—
Income Tax—
Employee NI—
Take-home
—
—
Effective rate: —
Option C
Inside IR35
Umbrella company
Umbrella company
Gross contract—
Umbrella margin—
Employer NI (15%)—
Apprenticeship Levy—
Employee gross pay—
Income Tax—
Employee NI—
Take-home
—
—
Effective rate: —
💡 Day Rate Uplift Required
To match your outside IR35 take-home while working inside IR35, you would need to negotiate a higher day rate. Here’s what to ask for:
Current day rate
—
Rate needed (Inside IR35)
—
— uplift required
Rate needed (Umbrella)
—
— uplift required
How IR35 Works
What is IR35?
IR35 (off-payroll working rules) is HMRC legislation designed to ensure contractors who work like employees pay broadly the same tax as employees. If your contract is “inside IR35”, income is treated as employment income. If “outside IR35”, you operate as a genuine business and can use salary + dividends.
IR35 (off-payroll working rules) is HMRC legislation designed to ensure contractors who work like employees pay broadly the same tax as employees. If your contract is “inside IR35”, income is treated as employment income. If “outside IR35”, you operate as a genuine business and can use salary + dividends.
Outside IR35 — Limited Company
You pay yourself a low salary (£9,100) and take remaining profits as dividends after Corporation Tax. Dividend tax rates are lower than income tax rates, and there’s no NI on dividends. Business expenses are deductible before Corporation Tax, and employer pension contributions are fully deductible.
You pay yourself a low salary (£9,100) and take remaining profits as dividends after Corporation Tax. Dividend tax rates are lower than income tax rates, and there’s no NI on dividends. Business expenses are deductible before Corporation Tax, and employer pension contributions are fully deductible.
Inside IR35 — Deemed Employment
The fee-payer (agency or client) deducts Employer NI (15% above £5,000) from your contract rate before paying you. The remainder is your “deemed salary” and is subject to Income Tax and Employee NI — just like a regular employee. You cannot claim expenses or pay dividends for that contract.
The fee-payer (agency or client) deducts Employer NI (15% above £5,000) from your contract rate before paying you. The remainder is your “deemed salary” and is subject to Income Tax and Employee NI — just like a regular employee. You cannot claim expenses or pay dividends for that contract.
Inside IR35 — Umbrella Company
The umbrella employs you and invoices your client. It deducts its margin, Employer NI, and the Apprenticeship Levy (0.5% of your salary) before calculating your PAYE. You receive the same statutory employment rights as an employee. Simpler admin than running your own company.
The umbrella employs you and invoices your client. It deducts its margin, Employer NI, and the Apprenticeship Levy (0.5% of your salary) before calculating your PAYE. You receive the same statutory employment rights as an employee. Simpler admin than running your own company.
Who determines IR35 status?
For medium/large private sector clients and all public sector clients, the end client determines status and issues a Status Determination Statement (SDS). Small companies (fewer than 50 employees, turnover under £10.2m, balance sheet under £5.1m — meeting 2 of 3) are exempt; in those cases the contractor determines their own status.
For medium/large private sector clients and all public sector clients, the end client determines status and issues a Status Determination Statement (SDS). Small companies (fewer than 50 employees, turnover under £10.2m, balance sheet under £5.1m — meeting 2 of 3) are exempt; in those cases the contractor determines their own status.
Assumptions & Notes
2025/26 rates for England, Wales & Northern Ireland · Outside IR35: salary of £9,100, Employer NI on salary (~£615) deducted before CT, remaining post-expense/pension profit paid as dividends after CT · Corporation Tax: 19% (≤£50k), 25% (≥£250k), marginal relief between · Dividend Allowance: £500; Dividend Tax: 8.75% / 33.75% / 39.35% · Inside IR35 (deemed): Employer NI at 15% deducted from gross before deemed salary calculated; Employee NI: 8% (£12,570–£50,270), 2% above · Umbrella: deducts margin + Employer NI (15% above £5,000) + Apprenticeship Levy (0.5% of salary above £9,100) before PAYE · Income Tax: Personal Allowance £12,570 (tapered above £100k), 20% / 40% / 45% · Expenses deductible outside IR35 only · Employer pension only applicable outside IR35 · Day rate uplift calculation based on iterative search to match outside IR35 take-home.
2025/26 rates for England, Wales & Northern Ireland · Outside IR35: salary of £9,100, Employer NI on salary (~£615) deducted before CT, remaining post-expense/pension profit paid as dividends after CT · Corporation Tax: 19% (≤£50k), 25% (≥£250k), marginal relief between · Dividend Allowance: £500; Dividend Tax: 8.75% / 33.75% / 39.35% · Inside IR35 (deemed): Employer NI at 15% deducted from gross before deemed salary calculated; Employee NI: 8% (£12,570–£50,270), 2% above · Umbrella: deducts margin + Employer NI (15% above £5,000) + Apprenticeship Levy (0.5% of salary above £9,100) before PAYE · Income Tax: Personal Allowance £12,570 (tapered above £100k), 20% / 40% / 45% · Expenses deductible outside IR35 only · Employer pension only applicable outside IR35 · Day rate uplift calculation based on iterative search to match outside IR35 take-home.
This calculator is for illustrative purposes only. IR35 status must be determined on a case-by-case basis based on the specific terms and working practices of each contract. Always consult a qualified accountant or IR35 specialist.