Our IR35 Calculator is an essential tool designed specifically for contractors and freelancers working in the UK. It provides a clear and accurate assessment of the financial impact the IR35 legislation can have on your net income. Introduced as part of the UK’s efforts to prevent tax avoidance by individuals working as disguised employees, IR35 can significantly alter how much tax you owe if your contract is deemed to be inside its scope.
Our calculator estimates the extra tax you might pay when inside IR35 compared to being outside IR35. Get an instant and detailed breakdown of your take-home pay for both Inside and Outside IR35.
Inside IR35
This calculation takes into account the PAYE income tax, National Insurance contributions, and other deductions typical for an employee. If your contract is considered inside IR35, you’ll see exactly how this affects your net pay.
Outside IR35
In this scenario, the calculator reflects the standard tax regime for contractors operating through their own limited company, factoring in corporation tax and dividend taxation. You’ll see a potential higher net income—assuming a genuine outside-IR35 working arrangement.
Compare Inside vs. Outside IR35 Income
By inputting details such as your contract rate, annual expenses, pension contributions, and salary, our calculator provides a side-by-side comparison, allowing you to clearly see the financial impact of being inside IR35 versus operating outside IR35. It highlights the difference in your take-home pay under each scenario.
Estimates Only:
Our calculator shows indicative figures based on the inputs you provide and assumed working patterns. Actual tax liabilities may vary with changing expenses, income levels, or legislative updates.
Not Formal Advice:
IR35 determination is nuanced. Always consult a qualified accountant, tax advisor, or specialist if you have concerns about compliance or contract wording.
Keep Up-to-Date:
Rates and thresholds for National Insurance, corporation tax, and income tax may change each tax year. Ensure the calculator or your inputs reflects current HMRC guidelines.