PAYE vs Limited Company Calculator 2026/27

It depends on your circumstances. Limited companies typically offer higher net income through tax-efficient salary/dividend splits, but have more admin, accountancy costs, and responsibilities. PAYE is simpler with less admin but often results in higher tax.

Tax efficiency through salary/dividend split, ability to claim more expenses, limited liability protection, potential to retain profits in the company, and professional image. However, there are accountancy costs and more administrative responsibilities.

Simplicity - no accounts to file, automatic tax/NI handled by employer, employment rights (holiday pay, sick pay), pension contributions from employer, and no personal liability for company debts.

If you're caught by IR35 (inside IR35), you'll be taxed similarly to an employee even through a limited company. The tax benefits of a limited company largely disappear, making PAYE/umbrella a simpler choice.

Business expenses including accountancy fees, professional subscriptions, equipment, travel (not regular commute), training, insurance, and home office costs if you work from home.