Director Salary and Dividend Calculator
Extraction details
Company profit after normal business expenses, but before this director's salary, employer National Insurance, employer pension contribution and Corporation Tax.
Annual gross salary from this company.
Quick salary presets
Company contribution — not salary and not a dividend.
For example, salary from another employment, pension income or taxable property income. Non-savings income only — do not include dividends entered elsewhere.
About this calculation
Salary versus dividends
Salary is deductible for Corporation Tax and attracts Income Tax and National Insurance. Dividends are paid from post-tax profit (or brought-forward reserves) and attract dividend tax, but not employee or employer NI. The modelled mix depends on thresholds, Corporation Tax rates, other income and student loans — there is no single salary that always produces the highest take-home. See Director Salary and Dividends Explained for the full extraction picture.
Corporation Tax and director National Insurance
Salary, employer NI and allowable employer pension contributions reduce taxable company profit before Corporation Tax. Dividends do not. For a dedicated company-tax estimate with accounting periods, associated companies and marginal relief, use the Corporation Tax Calculator. This director tool estimates Corporation Tax for a modelled accounting period — not automatically the same as the selected personal tax year. Directors normally use an annual earnings period for Class 1 NI (HMRC CA44). Employer NI is covered in Employer National Insurance Explained, and employer pension costs in Pension Tax Relief Explained.
Distributable reserves and estimates
A company may only pay dividends from available distributable reserves. This tool models current-period post-tax profit plus any brought-forward reserves you enter — it is not a legal clearance. Results are planning estimates, not an HMRC-approved tax return or accounts package. Personal Income Tax on salary and dividends follows the Income Tax Bands Explained guide.
Figures are estimates and may differ from payroll, accounts or Self Assessment. This is not tax, legal or financial advice.
Looking for employment take-home pay? Open the Income Tax Calculator. Working towards a net salary target? Open the Net to Gross Salary Calculator. Still sole trading? Open the Self-Employed Tax Calculator.
Related guides
- Director Salary and Dividends ExplainedOverview of how owner-directors extract company profit through salary, dividends, pensions and retained profit.Read guide
- Dividend Tax ExplainedHow personal Dividend Tax works — reserves, the dividend allowance, rates and band interaction.Read guide
- Corporation Tax ExplainedHow UK companies calculate taxable profit, apply Corporation Tax rates and meet filing deadlines.Read guide
- Employer National Insurance ExplainedHow employer Class 1 National Insurance is calculated and how it affects the total cost of employment.Read guide
- Employer Pension Contributions ExplainedHow company-paid pension contributions work for tax, National Insurance, Corporation Tax and annual allowance.Read guide