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Day rate to salary calculator, inside and outside IR35

Is £550 a day inside IR35 better than a £75,000 salary? Enter a day rate or a salary to see its equivalent through an umbrella company and through your own limited company, with every assumption on show.

Day rate calculator, inside and outside IR35

£0inside IR35
£0outside IR35
£0yearly billings
0billable days a year (260 working days minus days off)

Estimate only, not tax advice. Every default above is an assumption you can change: check the current rates on GOV.UK and the figures your umbrella or accountant gives you.

How the calculator works

  • Billable days: 260 working days minus the days you will not be paid for, such as holiday, bank holidays, sickness and gaps between contracts.
  • Inside IR35, through an umbrella: the umbrella takes its weekly margin, then the employer National Insurance and the Apprenticeship Levy, from what the agency pays. What is left is your gross pay, before income tax and employee National Insurance, and it is the figure to compare with a permanent salary.
  • Outside IR35, through a limited company: your company receives the full amount and pays its running costs (accountant, insurance, software). What is left is company income before corporation tax. In the salary direction, the outside rate is the one that lets your company cover what an employer would spend on that salary, plus your company costs.
  • No income tax: the calculator does not estimate income tax, National Insurance on your own pay, corporation tax or dividend tax.
  • VAT: all figures exclude VAT.

The result is an estimate for comparing offers, not tax advice. Your real figures depend on your umbrella's illustration, how you pay yourself from your company, your pension contributions and your tax position.

Find contract roles with a stated day rate

Frequently asked questions

How do I convert a day rate into a salary?

Multiply the day rate by the days you will actually bill, which is about 260 working days minus your holiday, bank holidays and gaps between contracts. Inside IR35, then take out the umbrella margin and the employer costs (employer National Insurance and the Apprenticeship Levy) to get a gross pay you can compare with a salary. The calculator above does exactly that.

How many days a year does a contractor bill?

There are about 260 working days in a year. Take out your holiday, the bank holidays and some sick days or gaps between contracts, and most contractors plan on somewhere between 200 and 230 billable days. Change the number of days off to match your plans.

Why are the employer NI and levy rates only assumptions?

Because they are set by the government and can change, and because employer National Insurance is only charged above a threshold, which a flat percentage simplifies. The defaults are a starting point: replace them with the current figures or with your umbrella's illustration.

Does the calculator include income tax?

No. It stops before income tax and employee National Insurance inside IR35, and before corporation tax and dividend tax outside IR35, because those depend on your whole situation. Use it to compare offers on the same basis, then check your take home pay with your umbrella or accountant.

Does the day rate include VAT?

No. Day rates in contract roles exclude VAT. If your limited company is VAT registered, it adds VAT to its invoices and pays it over to HMRC.

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