Optimum Director's Salary 2026/27
For owner-managed limited companies, the salary level changes the combined tax and NI cost. This compares the usual candidate salaries and shows which produces the lowest total on the figures you enter.
Your figures
Profit for the year before any director salary or dividends.
Single director, or a board with more than one director.
Drives Employment Allowance eligibility — sole-director-only companies cannot claim it.
Other employment, rental or pension income you receive.
If yes, dividend tax is calculated only on your share.
Enter your company profit above
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Tax year 2026/27 · figures as at 26 August 2026
How this is calculated
- Company profit before director salary£0
- Director salary testedChosen from £0, £5,000, £6,500, £9,100 and £12,570£0
- Employer NI before Employment Allowance15% on salary above £5,000£0
- Employment Allowance appliedNot available to sole-director-only companies−£0
- Employer NI payable£0
- Profit after salary and employer NI£0
- Corporation tax19% to £50,000, 25% above £250,000, with marginal relief between£0
- Distributable profit (dividends available)£0
- Your share of dividends100% — sole shareholder£0
- Personal allowance£12,570, tapered above £100,000£12,570
- Income tax on salary£0
- Employee National Insurance8% on salary above £12,570£0
- Dividend tax£500 allowance, then 10.75% / 35.75% / 39.35%£0
- Total tax burden (company + personal)£0
- Net take-homeSalary + dividends less personal tax and NI£0
Assumptions used
- England, Wales and Northern Ireland income tax rates for 2026/27 (Scottish rates differ for salary).
- Employer NI at 15% above £5,000; sole-director-only companies cannot claim Employment Allowance.
- Assumes all post-tax profit is distributed as dividends in the same year.
- Ignores pension contributions, benefits in kind and other reliefs, which can shift the optimum.
- Corporation tax includes marginal relief between the lower and upper limits.
Want this checked against your full position?
This assumes a straightforward owner-managed company. Multiple shareholders, pension contributions or other income can move the answer. We review this as part of our Limited Company Accounts work.
Related calculators
Estimate only, and not a recommendation on how to pay yourself. It ignores pension contributions, benefits in kind and Scottish rates, and assumes profits are sufficient to pay the salary and dividends shown. Salary also needs to be high enough to preserve your National Insurance record. Take advice before changing your payroll.