One day rate: inside IR35, outside IR35 and PAYE
The same day rate pays differently inside IR35, outside it through a limited company, and as a permanent salary. This page sets the three side by side on 2026/27 rates: what is billed, the tax, take-home pay and what goes into a pension.
Your figures
It opens on an example: £550 a day for 220 days, against a PAYE offer of £85,000 with a 5% employer pension. Change any of them. Your figures stay in this browser. The sums run on this page; nothing you type is sent to us or kept.
On these figures
On £550 a day for 220 days, take-home pay is about £5,849 a month inside IR35 and £6,142 a month outside it through the company; the PAYE offer of £85,000 pays £4,988 a month, on 2026/27 rates.
| Inside IR35 | Outside IR35 | PAYE offer | |
|---|---|---|---|
| Billed, or salary | £121,000 | £121,000 | £85,000 |
| Income Tax, National Insurance, student loan and Corporation Tax | £34,111 | £43,155 | £25,143 |
| Umbrella fee | £1,800 | £0 | £0 |
| Into a pension | £0 | £0 | £4,250 |
| Days worked | 220 | 220 | 227 |
| Take-home pay a month | £5,849 | £6,142 | £4,988 |
| Take-home pay for each day worked | £319 | £335 | £264 |
| Take-home pay a year | £70,193 | £73,710 | £59,857 |
Rates and thresholds for the 2026/27 tax year, as they apply in England and Northern Ireland. 220 days billed a year inside and outside IR35. The PAYE offer is paid for every weekday and worked on 227 of them (25 days holiday and 8 bank holidays). Inside IR35: an umbrella fee of £150 a month, and the employer’s National Insurance paid out of the assignment rate, as umbrella and fee-payer payrolls do. Outside IR35: a director’s salary of £12,570, the company’s profit after Corporation Tax paid out as dividends in the year, and no other income. The PAYE offer: a salary of £85,000.
On 2026/27 rates.
Figures follow the law as it stands. Announced and draft changes are not included.
How it is worked out
- Each column is worked out by the engine behind the app’s Company planner and Compare a job offer, on 2026/27 rates as they apply in England and Northern Ireland.
- Inside IR35: an umbrella or the fee-payer runs the pay through PAYE, and the employer’s National Insurance and the umbrella’s fee come out of the assignment rate before the salary is worked out.
- Outside IR35: the company pays a director’s salary at the Personal Allowance, its costs and Corporation Tax, and the rest is paid out as dividends in the year.
- The PAYE offer is paid for every weekday and worked on all but 25 days of holiday and 8 bank holidays.
- The columns are always in the same order. Nothing here says which status applies.
What it leaves out
- Whether the off-payroll working rules (IR35) apply to a contract. The client decides for a medium or large client, the contractor’s own company for a small one.
- Profit kept in the company rather than paid out, and an employer pension paid by the company.
- VAT, the Flat Rate Scheme, and the costs of running a company beyond those entered.
- Benefits that come with a permanent job: sick pay, holiday pay, a bonus or shares.
- Scottish Income Tax.
More on the assumptions behind the app’s own projection: how the retirement figures are worked out.
Questions
Who decides whether IR35 applies?
For a medium or large client, and any public sector client, the client decides and gives a status determination statement, with its reasons, to the worker and to whoever it contracts with. For a small client outside the public sector, the worker’s own company decides.
Source: GOV.UK
What is a status determination statement?
The client’s conclusion on whether the off-payroll working rules apply to an engagement, and its reasons. It goes to the worker and to the person or organisation the client contracts with.
Source: GOV.UK
Is there an official check?
HMRC’s Check employment status for tax tool gives HMRC’s view of whether the rules apply to an engagement, from the answers given.
Source: GOV.UK
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Keeping the figures
This page forgets your figures when you leave it. Oxygene Finance runs the same sums on your own pensions, ISAs, savings and property, for one or two people, and keeps them up to date as your figures change. Features and plans shows what is free and what is Premium.
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Oxygene Finance provides information, not financial advice. Figures are estimates based on what you enter and on assumptions you can change. For decisions that matter, a regulated financial adviser or an accountant can look at your whole situation.