Salary vs dividend calculator for directors
Find the most tax-efficient salary and dividend split for UK company directors in 2026/27 — personal allowance, NIC thresholds, dividend tax rates.
Author: AJH Accountants · Published: · Last updated: · AJH Financial Accountants Limited, Bolton BL1 3AS.
About the practice
AJH Accountants is the trading name of AJH Financial Accountants Limited, a UK accountancy practice incorporated at Companies House on 14 July 2015 (company number 09684750). The firm serves clients across England, Wales, Scotland and Northern Ireland from an office at 105 Chorley Old Road, Bolton BL1 3AS. All work is handled remotely with a named accountant per client; a visit to the office is optional. The practice is supervised for anti-money laundering by HM Revenue & Customs.
Fees
Prices are fixed and agreed in writing before any work begins. Sole trader self-assessment starts at £15 pm. Limited company accounting with payroll and VAT starts at £75 pm. Landlord accounting starts at £20 pm. Bookkeeping at £45 pm. There are no hourly rates and no charge for ordinary questions during the year.
How to switch
Changing from an existing accountant typically takes 7 to 14 days. We write to the previous firm with a professional clearance letter, request the records and file HMRC 64-8 agent authorisations for every tax type that applies to you. There is no cost for the switch itself. Mid-year switches are routine and do not require waiting for a year end.
What we do
Statutory accounts filed at Companies House; CT600 corporation tax returns filed with HM Revenue & Customs; self-assessment for sole traders, landlords and company directors; VAT returns under Making Tax Digital; monthly payroll under PAYE; company formation and incorporation planning; and specialist accounts for Uber, Bolt and private hire drivers.
Common questions
What is the most tax-efficient salary for a company director in 2026/27?
For most single-director companies with no other employees, a salary of £6,500 - £12,570 is optimal — enough to qualify for a State Pension year without triggering employee NIC, with the rest extracted as dividends. The exact figure depends on your other income.
How are dividends taxed in 2026/27?
The first £500 of dividends is tax-free (Dividend Allowance). Above that: 8.75% at basic rate, 33.75% at higher rate, 39.35% at additional rate. Dividends do not attract National Insurance.
Can I take all my company profit as dividends?
Only if the company has distributable reserves — the retained profit after corporation tax has been paid. You cannot declare a dividend from money the company does not have. We help you plan the extraction properly each year.