00 / Calculator
Sole trader vs limited company calculator
Use this calculator to compare the simplified 2026/27 tax position for a UK founder operating as a sole trader versus through a limited company.
The result is deliberately not the whole answer. Liability, customer perception, investment plans, admin burden and whether you need all the cash personally can matter more than a small tax difference.
02 / Breakdown
Where the difference comes from.
| Line | Sole trader | Limited company |
|---|---|---|
| Income tax | £11,432 | £0 |
| Class 4 NI / Employer NI | £2,457 | £1,136 |
| Employment Allowance used | - | £0 |
| Corporation tax | - | £8,796 |
| Dividend tax | - | £3,977 |
| Retained in company | - | £0 |
| Total tax | £13,889 | £13,909 |
Important
This calculator is simplified and uses 2026/27 UK assumptions. It does not replace advice based on your actual income, contracts, pension planning, IR35 position, VAT, student loans, child benefit, spouse shareholdings, capital allowances, losses, sector risk or wider plans. Liability, credibility, admin burden and strategy can matter more than the tax result.
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