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Inside IR35 vs Outside IR35 Calculator
Use this calculator to compare your take-home pay, pension contributions and tax liabilities under both Inside IR35 (Umbrella) and Outside IR35 (Limited Company) scenarios.
The Off-Payroll Working Rules (IR35) are UK tax rules that determine whether a contractor should be treated as an employee for tax purposes. If you're working "Inside IR35", you'll often work through an umbrella company and pay tax like an employee. If you're "Outside IR35", you can usually operate through your own limited company and potentially retain more of your earnings, though you'll have more responsibilities and costs to manage.
Inside IR35 (Umbrella)
Breakdown
| Gross Income | £110,000 |
| Less: Umbrella Margin | -£1,100 |
| Less: Umbrella Fees | -£264 |
| After Margin & Fees | £108,636 |
| Less: Pension (15%) - Salary Sacrifice | -£16,295 |
| After Salary Sacrifice | £92,341 |
| Less: Employer NI (15%) | -£11,392 |
| Less: Apprenticeship Levy (0.5%) | -£462 |
| Taxable Income | £80,487 |
| Less: Income Tax | -£19,627 |
| Less: Employee NI | -£3,620 |
| Net Take-Home | £57,240 |
Outside IR35 (Limited Co.)
Breakdown
| Base Revenue (ex-VAT) | £110,000 |
| VAT Threshold Hit? | Yes (over £90,000) |
| Plus: VAT Added to Invoices (20%) | +£22,000 |
| Total Turnover (inc. VAT) | £132,000 |
| Less: VAT Paid to HMRC (16.5% of turnover) | -£21,780 |
| Net Company Revenue | £110,220 |
| Less: SIPP Contribution (15%) | -£16,533 |
| Less: Salary | -£12,570 |
| Less: Employer NI on Salary | -£1,135 |
| Less: Business Expenses | -£2,000 |
| Profit Before Corp Tax | £77,982 |
| Less: Corporation Tax (19%) | -£14,816 |
| Available for Dividends | £63,165 |
| Dividends Taken (100%) | £63,165 |
| Less: Dividend Tax | -£14,867 |
| Less: Personal Tax on Salary | -£0 |
| Net Take-Home | £60,868 |
| Retained in Company | £0 |
Rate Comparisons
This takes into account your current inputs across a wide range of different rates.
| Day Rate | Umbrella Gross Income | Umbrella Take-Home | Umbrella Pension | Limited Gross Income | Limited Take-Home | Limited Pension | Take-Home Difference | Total Difference |
|---|---|---|---|---|---|---|---|---|
| £200 | £44,000 | £26,080 | £5,529 | £30,143 | £28,649 | £6,600 | +£2,569 | +£3,639 |
| £300 | £66,000 | £37,721 | £8,382 | £45,290 | £40,698 | £9,900 | +£2,977 | +£4,495 |
| £400 | £88,000 | £47,485 | £11,235 | £60,437 | £50,733 | £13,200 | +£3,248 | +£5,213 |
| £500 * | £110,000 | £56,862 | £14,088 | £75,735 | £60,868 | £16,533 | +£4,006 | +£6,451 |
| £600 | £132,000 | £66,239 | £16,942 | £90,912 | £70,923 | £19,840 | +£4,684 | +£7,582 |
| £700 | £154,000 | £73,182 | £19,795 | £106,090 | £80,978 | £23,146 | +£7,796 | +£11,148 |
| £800 | £176,000 | £79,805 | £22,648 | £121,267 | £91,033 | £26,453 | +£11,228 | +£15,033 |
| £900 | £198,000 | £88,374 | £25,501 | £136,444 | £100,483 | £29,759 | +£12,109 | +£16,368 |
| £1000 | £220,000 | £96,942 | £28,354 | £151,621 | £109,688 | £33,066 | +£12,746 | +£17,458 |
| £1100 | £242,000 | £105,511 | £31,207 | £166,799 | £118,894 | £36,373 | +£13,383 | +£18,548 |
| £1200 | £264,000 | £114,080 | £34,060 | £181,976 | £128,099 | £39,679 | +£14,019 | +£19,638 |
| £1300 | £286,000 | £122,649 | £36,913 | £197,153 | £137,304 | £42,986 | +£14,656 | +£20,729 |
| £1400 | £308,000 | £131,995 | £38,298 📉 | £212,331 | £146,510 | £46,292 | +£14,514 | +£22,509 |
| £1500 | £330,000 | £145,436 | £31,958 📉 | £227,508 | £155,715 | £49,599 | +£10,279 | +£27,920 |
| £1600 | £352,000 | £158,877 | £25,618 📉 | £250,601 | £169,722 | £43,133 📉 | +£10,844 | +£28,359 |
| £1700 | £374,000 | £172,319 | £19,277 📉 | £275,061 | £184,557 | £34,980 📉 | +£12,238 | +£27,941 |
| £1800 | £396,000 | £185,760 | £12,937 📉 | £299,520 | £199,392 | £26,827 📉 | +£13,632 | +£27,522 |
| £1900 | £418,000 | £197,397 | £10,000 📉 | £323,980 | £214,227 | £18,674 📉 | +£16,830 | +£25,504 |
| £2000 | £440,000 | £207,478 | £10,000 📉 | £348,440 | £229,063 | £10,520 📉 | +£21,585 | +£22,105 |
Go further using Saving Tool Advanced
This calculator serves as a general guide for figuring out the difference between contracting through an Umbrella company and a Limited Company. To run a full personal finance simulation that takes into account your income, outgoings, existing investments and lots more, create a scenario using Saving Tool Advanced.
Go to Saving Tool Advanced →Notes
- Pension contributions are on a salary sacrifice basis
- No consideration of sick pay or holidays
- For umbrella companies, the apprenticeship levy (0.5% of payroll) is applied, as most umbrella companies exceed the £3 million annual payroll threshold
- For limited companies with revenue over the £90,000 threshold, VAT is added to invoices at 20%, and the Flat Rate VAT scheme applies at 16.5% of total turnover (limited cost business rate). VAT is not included in 'HMRC Collected' because it is a pass-through tax.
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