Limited Company Tax Calculator
The whole picture in one place. Enter your turnover, expenses and director salary and this limited company tax calculator works out Corporation Tax, both National Insurance charges, dividend tax, and what actually reaches your pocket.
This limited company calculator runs the whole chain in one pass: turnover through Corporation Tax, National Insurance and dividend tax to what actually reaches you. If you only want the Corporation Tax figure and not the personal side, the corporation tax calculator takes a profit figure and handles associated companies and short accounting periods.
What this ltd co calculator covers #
One calculation from turnover all the way to your pocket. Corporation Tax with marginal relief, employer and employee National Insurance, Income Tax on the salary and dividend tax on what is left. Most tools online do one of those in isolation, which is why their answers never reconcile with each other.
How much tax does a limited company pay? #
Corporation Tax is 19% on profits up to £50,000 and 25% above £250,000. In between there is marginal relief, which sounds like a discount and is not. Each pound of profit in that band is charged at an effective 26.5%, which is higher than the main rate itself.
| Profit | Corporation Tax | Effective rate |
|---|---|---|
| £30,000.00 | £5,700.00 | 19% |
| £50,000.00 | £9,500.00 | 19% |
| £100,000.00 | £22,750.00 | 22.75% |
| £150,000.00 | £36,000.00 | 24% |
| £250,000.00 | £62,500.00 | 25% |
| £400,000.00 | £100,000.00 | 25% |
The profit is taxed twice #
This is the part that surprises people who have just incorporated. The company pays Corporation Tax on its profit. Then you pay dividend tax on what you take out of the profit that is left. Two charges on the same money.
Take £100 of company profit at the small profits rate. £19 goes in Corporation Tax, leaving £81 to distribute. A basic rate taxpayer then pays 10.75% on that £81, which is £8.71. You keep £72.29, so the combined rate is around 28%.
The gap against a sole trader is narrower than it was, because dividend rates rose on 6 April 2026. Work out the dividend tax on its own.
Why the salary figure matters so much #
Salary is deductible for the company, so every pound reduces profit and therefore Corporation Tax. Dividends are not deductible, because they come out of profit that has already been taxed.
Against that, salary attracts employer National Insurance at 15% above £5,000 and employee National Insurance at 8% above £12,570. Dividends attract neither. Where those forces balance depends on your profit level, and it is not the same answer for every company. The optimiser tests every level.
What this calculator does not cover #
- Scottish taxpayers. Different Income Tax bands on salary. Corporation Tax and dividend rates are UK-wide.
- VAT, which is charged on top of turnover and is not company income
- Pension contributions, usually the most efficient extraction route of all
- Associated companies, which reduce the £50,000 and £250,000 thresholds
- Capital allowances, R&D relief and other reliefs that reduce taxable profit
- Accounting periods other than twelve months
- Student loan repayments and the High Income Child Benefit Charge
Treat the result as a planning figure. The exact number comes out of your company accounts and your Self Assessment return.
Common questions #
How much tax does a limited company pay?
Corporation Tax is 19% on profits up to £50,000 and 25% above £250,000. Profits between the two are charged at an effective 26.5% on each pound in that range, which produces an overall rate somewhere between 19% and 25%.
Is a limited company more tax efficient than being a sole trader?
Often, but not always. A company pays Corporation Tax on profit and the director then pays dividend tax on what is taken out, so the profit is taxed twice. The saving comes from dividends carrying no National Insurance. The gap narrowed when dividend rates rose on 6 April 2026.
What is the effective tax rate on a limited company?
It depends on profit and on how much is taken out. This calculator shows the combined rate across Corporation Tax, both National Insurance charges, Income Tax and dividend tax, measured against turnover after expenses.
Do I have to take all the profit out?
No. Profit left in the company has borne Corporation Tax but no dividend tax. Retaining profit defers the personal tax, which is why the take-home figure here assumes you distribute everything and is therefore a worst case.