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Would I take home more as a limited company?

Compare your take-home pay as a sole trader with running a one-person limited company that pays a small salary and the rest as dividends, using 2026-27 rates.

2026-27 tax year

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What this assumes

    Guidance, not tax advice. Rules change; check GOV.UK or an accountant for your situation.

    Questions

    Is a limited company always better for tax?

    No. Since dividend tax rose in April 2026 and with corporation tax at up to 25%, many people with profits under about £50,000 to £60,000 take home less through a company, before counting the extra accounting and admin.

    What salary should a director take?

    Many directors take a salary around the personal allowance, £12,570, which builds a National Insurance record without income tax. With no other employees, employer National Insurance is due above £5,000.

    What else should I think about?

    Limited liability, pensions paid by the company, keeping profit in the company, IR35 if you work through a client, and how lenders see your income. Speak to an accountant before you change.