The UK Dividend vs Salary Calculator 2026/27 is a free web tool from UK Creative Ventures that helps limited company directors determine the most tax-efficient way to take income from their company. It calculates income tax, National Insurance (employee and employer), dividend tax, and corporation tax in one place, using the April 2026 tax rates.
What is the UK Dividend vs Salary Calculator?
This is a financial planning tool that takes your company's pre-tax profit, other personal income, employer pension contributions, and number of associated companies as inputs. It then outputs a recommended salary/dividend split, along with a full breakdown of taxes owed and net take-home pay for three strategies: the optimal split, pure salary, and pure dividends. The tool runs entirely in the browser and is provided free by UK Creative Ventures, a Bristol-based business services firm.
Key Features
- Optimal strategy finder — Automatically identifies the best salary/dividend combination based on your inputs, highlighting the personal allowance salary (£12,570) plus dividends as the default recommendation.
- Full tax breakdown — Shows company-level calculations (profit before salary, employer NI, corporation tax, retained profit) and personal-level calculations (salary, dividends, dividend tax) for each strategy.
- Three-way comparison — Displays side-by-side results for the optimal split, pure salary, and pure dividends, making it easy to see the trade-offs.
- Interactive salary slider — Lets you drag a slider to see how different salary levels affect net take-home pay, total tax, and the effective marginal rate.
- Marginal relief insights — Provides contextual tips when your company profit falls in the £50k-£250k marginal relief band, explaining the 26.5% corporation tax rate implications.
- Updated for 2026/27 — Reflects the latest income tax, NI, dividend tax, and corporation tax rates for the 2026/27 tax year.
Who is it for?
- Limited company directors — To decide how much salary versus dividends to draw each year, balancing personal tax against corporation tax savings.
- Accountants and tax advisors — To quickly model different remuneration strategies for their clients and illustrate the tax consequences.
- Contractors and freelancers — Operating through their own limited company who want to optimise their income extraction without needing to run complex spreadsheets.
What can you do with it?
- Compare remuneration strategies: Enter your company profit and see the net take-home and total tax for the optimal split, pure salary, and pure dividends, so you can choose the approach that suits your cash flow needs.
- Model pension contributions: Add employer pension contributions to see how they reduce taxable profit and save corporation tax, giving a more complete picture of your overall compensation.
- Adjust for associated companies: Specify the number of associated companies to correctly calculate corporation tax thresholds, which is essential for groups of companies.
- Explore marginal rates: Use the salary slider to understand how each extra pound of salary affects your total tax bill and effective marginal rate, helping you fine-tune your strategy.
