IR35 Inside vs Outside Calculator 2026/2027

Tax Year:

Tax Code:

Day rate £:

Working days / year:

Agency margin £/week:

Outside business expenses £/year:

Outside director salary £/year:

Client is a small private-sector company (5% expense allowance applies for Inside)

Inside = deemed-employment payment via PAYE. Same algebra as Umbrella: contract minus agency margin (and 5% allowance if small-client), then employer NI + Apprenticeship Levy stripped before a PAYE salary is derived.
Outside = your own Limited Co. Revenue minus expenses → corp tax → distributable profit → salary + dividends. Outside drains all distributable as dividends so the comparison is apples-to-apples.
5% expense allowance only survives in the small-client exemption (off-payroll rules don't apply when the end-client is a small private-sector company).

IR35 Inside vs Outside

For contractors comparing the take-home cost of an inside-IR35 status determination against a clean outside-IR35 Limited Co route. Useful when negotiating rate adjustments or weighing a contract change.

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How this IR35 calculator works

Enter a contract day rate, working pattern and umbrella margin — the calculator shows take-home under both inside-IR35 (PAYE via umbrella) and outside-IR35 (limited company salary and dividends) assumptions side by side. The pound difference shown is the real cost of an inside status determination for your engagement.

Inside IR35: the full assignment rate is treated as employment income, with employer NI deducted before PAYE applies. Outside IR35 via a limited company: you draw a tax-efficient salary and take the rest as dividends, keeping your overall tax bill significantly lower for the same gross contract value.

IR35 status is determined by the working practices of each contract, not by the contractor's preference. If your end-client issues an inside determination, this calculator shows exactly what that costs you in take-home pay compared with an outside engagement.