IR35 Calculator
Compare take-home pay inside vs outside IR35 for 2025/26. See every umbrella company deduction, calculate the rate uplift you need, and make informed decisions about your contracting structure. Updated for the April 2025 employer NI increase to 15%.
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How to Use This Calculator
Inside vs Outside tab
Enter your daily rate, working days per year, and annual business expenses. The calculator computes your take-home pay under both IR35 scenarios: inside (via an umbrella company, taxed as employment) and outside (via your own Ltd company, using salary + dividends). The gap shows you exactly how much IR35 status affects your income.
Umbrella Breakdown tab
Enter your annual assignment rate (daily rate x days). See every deduction step by step: umbrella margin, apprenticeship levy, employer NI (15% from April 2025), employee NI, and income tax. This transparency shows where your money goes before it reaches your bank account.
Rate Negotiation tab
Enter your desired annual take-home income. The calculator works backwards to find the daily rate you need to negotiate if a contract is inside IR35. It also compares this to the equivalent outside IR35 rate, showing the percentage uplift required.
The Formula
Key insight: employer NI is deducted from your assignment rate, not added on top. At 15% from April 2025 (up from 13.8%), this is the single biggest hidden cost of working inside IR35. On a £500/day contract, employer NI alone takes roughly £14,000/year.
Example
Sarah -- IT Consultant in London, £500/day
Sarah works 220 days/year on a £500/day contract. Her annual revenue is £110,000. She has £5,000 in business expenses through her Ltd company.
Inside IR35, Sarah loses £15,400/year compared to working through her Ltd company. That is roughly £1,280/month. If her contract moves inside IR35, she would need to negotiate a rate of approximately £630/day to maintain the same take-home pay.