Question 1

How much of a £500 day rate do you actually keep?

Accepted Answer

At 220 days, an umbrella contractor keeps about 58.7% (£64,555.40 a year) after employer NI and margin; a limited company keeps about 60.1% (£66,083.26) after corporation and dividend tax.

Question 2

Why is umbrella take-home lower than LTD?

Accepted Answer

Because the umbrella deducts employer NI (15% above £5,000) and its margin from your assignment rate. An outside-IR35 limited company pays corporation tax and dividend tax instead, which at typical contractor rates totals less.

Question 3

Are the 2026/27 thresholds changing?

Accepted Answer

No. The personal allowance (£12,570) and basic rate limit (£37,700) are fixed by legislation through 5 April 2028, per HMRC's published policy paper.

Umbrella vs LTD take-home calculator (2026/27)