Contractor take-home pay 2026/27: umbrella vs limited company
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Everything a UK contractor takes home in 2026/27 depends on three deductions: income tax (20/40/45%), employee National Insurance (8%/2%), and — if you're inside an umbrella — employer NI (15%) plus the umbrella's margin. Outside IR35 via your own limited company, corporation tax (25%) and dividend tax (8.75/33.75/39.35%) apply instead.
Umbrella vs LTD at a glance (220 chargeable days)
| Day rate | Umbrella take-home | LTD take-home | LTD advantage |
|---|---|---|---|
| £350 | £48,286.40 | £49,686.39 | £1,399.99 |
| £400 | £53,709.40 | £55,152.01 | £1,442.61 |
| £500 | £64,555.40 | £66,083.26 | £1,527.86 |
| £600 | £74,221.40 | £77,014.51 | £2,793.11 |
| £750 | £88,420.90 | £93,411.39 | £4,990.49 |
| £900 | £103,287.40 | £108,466.11 | £5,178.71 |
How the calculation works
Umbrella: the assignment rate is grossed up — employer NI comes out of your rate first, then the umbrella margin (£20–35/week typical), leaving your taxable pay. Income tax and employee NI then apply normally.
Limited company: you pay yourself a small salary (£12,570 — tax-free, no employee NI) and take the rest as dividends after 25% corporation tax. Dividends are taxed at 8.75% to £25,130 above your salary, 33.75% above that.
The 2026/27 numbers that matter
| Item | 2026/27 |
|---|---|
| Personal allowance (fixed to 2028) | £12,570 |
| Basic rate — 20% | to £50,270 total |
| Higher rate — 40% | £50,271–£125,140 |
| Additional — 45% | over £125,140 |
| Employee NI | 8% (£12,570–£50,270), 2% above |
| Employer NI | 15% above £5,000 |
| Dividend allowance | £500 |
Run your exact numbers
The calculator interpolates these tables for any day rate and day count:
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