Sole traders
Draft: awaiting review by a qualified accountant
Sole trader vs limited company calculator
Running your business through a limited company can mean less tax, but it brings extra costs and paperwork. Enter your profit to see your take-home pay under each structure, using this year's rates.
Tax year 6 April 2026 to 5 April 2027
£
Result
About the same either way
Sole trader
Income tax£11,432
Class 4 NI£2,457
Total tax£13,889
Take-home£46,111
Limited company
Your salary£12,570
Employer NI£1,136
Corporation tax£8,796
Dividends paid to you£37,499
Your income tax and NI£3,977
Take-home£46,091
- All company profit after corporation tax is paid out as dividends in the same year.
- Director's salary chosen from £0, £5,000 and £12,570, whichever leaves you most.
- No Employment Allowance: it isn't available when a director is the only employee.
- Ignores accountancy and company running costs, pensions, student loans and other income.
For guidance only, not tax advice. Based on 2026 to 2027 rates, last checked 3 November 2026.
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Common questions
- At what profit is a limited company worth it?
- It depends on your profit, how much you take out and your other income. The tax saving has to outweigh extra costs like accountancy fees and company admin. Use the calculator for your own figure.
- How does the calculator pay me from the company?
- It tries a small salary and pays the remaining profit as dividends after corporation tax. It picks whichever salary leaves you most.