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IR35 Comparison Tool

Compare estimated cash take-home for the same day rate using 2026/27 tax assumptions.

Contract Details

Modelled as salary sacrifice inside IR35 and an employer contribution outside IR35.

Estimated annual cash take-home gap

£3,080.81

Higher under Outside IR35 assumptions

Inside IR35 (Umbrella)

£5,216.75

per month net

Outside IR35 (Limited)

£5,473.49

per month net

What drives the difference?

Inside IR35: The assignment income funds the umbrella margin and employer National Insurance before PAYE and employee NI.

Outside IR35: The model includes company expenses, director-salary employer NI, corporation tax and personal dividend tax.

Financial Breakdown

Inside and outside IR35 financial comparison
MetricInside IR35Outside IR35
Gross Annual Income£110,000.00£110,000.00
Umbrella / company costs£14,269.57£23,518.54
Personal tax and employee NI£27,129.38£14,799.60
Pension contribution£6,000.00£6,000.00
Net Take-Home (Annual)£62,601.05£65,681.86

Methodology

2026/27 assumptions

  • • Uses England, Wales and Northern Ireland Income Tax bands; Scottish Income Tax is not modelled.
  • • Inside IR35 assumes the entered day rate is the umbrella assignment rate and deducts the weekly umbrella margin.
  • • Apprenticeship Levy and separate holiday-pay arrangements are excluded.
  • • Outside IR35 assumes one company, no associated companies, a £12,570 director salary and available profits paid as dividends.
  • • Corporation-tax marginal relief and the £500 dividend allowance are included.
  • • This is an estimate, not tax or IR35-status advice.
UK Tax Rules for Contractors 2026/27

IR35 & Tax — FAQ

Everything you need to know about the differences between contracting Inside and Outside IR35.

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