Free calculator

Salary vs dividend calculator

Compare taking an extra amount out of your limited company as salary versus as a dividend, side by side, using this tax year's income-tax, National Insurance and dividend rates — the tax, the cash in your pocket and the cost to the company for each route. Illustrative arithmetic, not a recommendation.

Salary you already take (defaults to the personal allowance)

Extra to take out

Dividends already taken this year

Can your company claim the Employment Allowance?

A company whose only employee is a director can't claim it — leave this off if you're not sure.

As salary

£21,600

in your pocket, from £30,000

Income tax: £6,000
Your NI: £2,400
Employer NI (company cost): £4,500
Total cost to company: £34,500

As dividend

£27,419

in your pocket, from £30,000

Dividend tax: £2,581

Your accountant knows your full picture — this is the illustrative arithmetic, not a recommendation. The right split depends on things we can't see here.

Corporation tax isn't modelled — salary is a deductible company expense, dividends are paid from post-corporation-tax profit. Leaving it out makes the dividend route look better here than it may in full.
Whether the company qualifies for the Employment Allowance (a single-director-employee company does not).
Pension, student-loan, benefit and other-income interactions, and the >£100k personal-allowance taper.

This is an illustration, not a quote. It's a rough picture based only on what you've entered: a figure to picture, not a promise. The real amount depends on your circumstances and things we can't see, so it's always worth checking your own position before you count on it. It shows the two routes side by side on the numbers you enter, using this year's tax, National Insurance and dividend rates — it is illustrative arithmetic, not a recommendation and not a verdict on which is right for you. It leaves out things that matter a lot (corporation-tax relief on salary, pension and mortgage implications, other income, and whether your company qualifies for the Employment Allowance). Your accountant, who can see your full picture, is the place to confirm the right split.

Statutory figures are the 2026/27 UK tax-year rules.

This calculator, the result and the breakdown are free for everyone, no account needed.

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How it works

1Enter the salary you already take this year, so the extra amount stacks on top of it in the right tax bands.
2Enter the extra amount you want to compare, and any dividends you've already taken this year, so the dividend allowance and band-stacking are honest.
3Tell it whether the company can claim the Employment Allowance, since that changes the employer National Insurance on the salary route.
4The calculator works out each route's tax, National Insurance, the net cash you'd keep and the total cost to the company — shown side by side, with no verdict.

Worked example

A director already on a £12,570 salary, comparing an extra £30,000 taken as salary versus as a dividend, with no dividends yet this year and no Employment Allowance. The calculator shows, for each route, the tax and National Insurance, the net cash kept and the total cost to the company — side by side, without picking a winner.

Salary route — cash in pocket£21,600

Dividend route — cash in pocket£27,419

Salary route — cost to company£34,500

Dividend route — cost to company£30,000

It's illustrative arithmetic, not a recommendation. It leaves out things that matter a lot — corporation-tax relief on salary, pension and other income, and whether your company qualifies for the Employment Allowance. An accountant can confirm the right split.

Frequently asked questions

Is it better to take salary or dividends?

It depends on your wider position — corporation tax, pensions, other income and your company's circumstances all matter. This calculator shows both routes side by side on your numbers so you can see the difference; it doesn't pick one for you.

How much tax do I pay on dividends?

Dividends have a tax-free allowance, then are taxed at their own rates that depend on your other income and the band the dividend falls in. Enter your figures and the calculator estimates the dividend tax on the extra amount.

Why does the salary route show employer National Insurance?

Paying a salary can cost the company employer National Insurance on top of the salary itself, which a dividend doesn't. The calculator shows this as a company cost so the full cost of each route is comparable.

What does this calculator leave out?

A lot that matters — corporation-tax relief on salary, pension implications, other income and whether the company can claim the Employment Allowance. It's illustrative arithmetic; your accountant, who can see the full picture, confirms the right split.

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