Tax Calculator.

One of the most common questions we get asked is how should I pay myself efficiently? The answer is quite straightforward but we have created a Tax Calculator you can use to see the numbers behind the answer.

Tax calculator. This downloadable Excel document can be used to understand the taxes that will apply depending on how you pay yourself, as well as a handy comparison between Limited Companies and Sole Traders.

Tax Calculator and Optimiser

This calculator estimates your:
- income tax
- dividend tax
- National Insurance Contributions (for Limited Companies and Sole Traders)
- Corporation tax

It illustrates your optimal salary dividend mix for minimising your overall tax liability and also provides a comparison between Sole Trader and Limited Companies in terms of tax-efficiency at various revenue levels.
Download TAX Calculator 2019/20
Download TAX Calculator 2020/21

How much should I pay in dividends and salary? Answers below or in the calculator

I am the sole director employee of my limited company

For 2019/20, pay yourself £8,632 in salary and the remainder of profit you want to extract, in dividends. This is called the Primary Threshold and above this your company pays 13.8% Employers NIC which makes it less efficient to pay salary than dividends. This assumes you have not received salary elsewhere in the year.

I am a director of a company with > 1 employees

For 2019/20, pay yourself £12,500 in salary and the remainder of profit you want to extract, in dividends. This is your Personal Allowance and above this level you pay income tax on your earnings. As a company with more than one employee, you qualify for Employers Allowance for the first £4,000 of Employers NICs which is why the salary amount is higher in the single employee scenario. This assumes you have not received salary elsewhere in the year.

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