Inside IR35 Calculator
Enter your day rate to see your estimated inside IR35 take-home pay after employer’s NI, income tax, employee NI, and umbrella fees.
Working inside IR35 means your contract income is taxed similarly to employment, with employer’s NI deducted from your gross pay before income tax and employee NI are applied. This typically reduces your take-home to 55–65% of gross.
Use this calculator to estimate your annual and monthly take-home pay at any day rate, including the impact of umbrella fees, pension contributions, and student loan repayments.
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What this calculator does
This calculator estimates your inside IR35 take-home pay by modelling the deemed-salary calculation: deducting employer’s NI from your gross, then applying PAYE income tax, employee NI, pension, and student loan deductions to the remaining amount.
Who it is for
UK contractors working inside IR35, contractors evaluating inside vs outside IR35, anyone considering umbrella company employment, and recruiters or clients explaining the financial impact of IR35 determinations.
How to use it
Enter your day rate, working days per week, and weeks per year. Add any umbrella company fees, pension contributions, or student loan plan. Click to see your estimated take-home pay.
How the calculation works
Gross = day rate × days × weeks. Employer’s NI (13.8%) and apprenticeship levy (0.5%) are deducted to give the deemed salary. Income tax uses 2025/26 bands (20/40/45%). Employee NI is 8% between £12,570 and £50,270, then 2% above. Pension reduces taxable income. Student loan repayments use the relevant plan threshold.
Worked example
Day rate £450, 5 days/week, 46 weeks: Gross = £103,500. After employer’s NI (£13,589) and levy (£518): Deemed salary = £89,393. Income tax = £21,765. Employee NI = £4,766. Take-home ≈ £62,862/year (£5,239/month). That is approximately 60.7% of gross.
Assumptions and limitations
- Uses 2025/26 UK tax rates, NI thresholds, and personal allowance (£12,570)
- Personal allowance tapers at £1 for every £2 above £100,000
- Employer’s NI at 13.8% above the secondary threshold (£5,000)
- Apprenticeship levy at 0.5%
- Does not include employment benefits, holiday pay accrual, or employer pension contributions
- Umbrella fee is a monthly flat fee deducted from gross
- This is an estimate — consult a specialist contractor accountant for exact figures
Frequently asked questions
How much will I take home inside IR35?
Typically 55–65% of your gross contract value, depending on your day rate, working pattern, and personal circumstances. Higher day rates mean a lower take-home percentage due to higher-rate tax.
What is the difference between inside and outside IR35?
Inside IR35: you are taxed like an employee, with employer’s NI deducted from your gross. Take-home is typically 55–65%. Outside IR35: you pay yourself through a limited company via salary and dividends, with take-home typically 75–85%.
Do I need an umbrella company for inside IR35?
If your contract is inside IR35 and the end client does not handle payroll directly, you will typically need an umbrella company to process your pay. Monthly fees are usually £15–40.
Can I claim expenses inside IR35?
Expense claims inside IR35 are very limited. You generally cannot claim travel, subsistence, or home office costs. Only expenses that would be allowable for a regular employee in the same role may qualify.
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Related guides
- Inside IR35 Explained: What UK Contractors Need to Know — A clear guide to working inside IR35, how it affects your take-home pay, and what it means for your contract.
- How to Calculate Your Freelance Day Rate — A practical guide to setting your day rate as a freelancer or contractor, including salary equivalence and market benchmarks.
- How Overtime Pay Works in the UK — Understand your overtime pay rights, how it is taxed, and how different multipliers affect your earnings.
- How Holiday Accrual Is Calculated in the UK — Learn how holiday builds up over a leave year and how to check how much you have accrued so far.
- How Holiday Entitlement Works in the UK — A practical guide to understanding your statutory holiday entitlement as a UK worker, covering full-time, part-time, and irregular working patterns.
- Outside IR35 Explained for UK Contractors — What outside IR35 means, how it affects your take-home pay, and the key differences between inside and outside IR35.
Sources and references
HMRC IR35 guidance (https://www.gov.uk/guidance/understanding-off-payroll-working-ir35), Income tax rates 2025/26 (https://www.gov.uk/income-tax-rates), NI rates (https://www.gov.uk/national-insurance-rates-letters)
Last updated
Last reviewed: 2025-04-12.