Enter your annual profit. We tax it both ways - sole trader vs limited company extracting everything - and show the winner.
Scottish bands apply to your sole-trader income. Dividends are taxed at UK-wide rates, so the company side is the same across the UK.
Most single-director companies with no other employees can't claim this - leave off if unsure. It only affects employer NI on your salary.
Tax comparison only, for 2026/27, assuming all profit is extracted in the year. A company typically adds £1,500–£2,500 a year in accountancy and filing costs on top.
The verdict on profit
keeping more per year ( vs )
Both routes keep almost exactly the same after tax.
Sole trader
take-home · tax
Limited company
take-home · tax
Crossover point
Tax estimate only - it excludes accountancy costs, pensions and retained profit. Take advice before incorporating.
Both routes across the profit range, using your salary and region settings. Where the green line rises above the blue one, incorporating starts to pay off.
Sole trader
Limited company (full extraction)
Company route: salary is a deductible expense, the company pays employer NI at above , Corporation Tax uses the small-profits rate, main rate and marginal relief, and the remaining profit is paid out as dividends taxed after the allowance. Sole trader route: Income Tax on profits plus Class 4 NI at then .
A company still wins when you…
But budget for the extras
The Sole Trader vs Limited Company Calculator does more than show a number. Below your result it explains what your figures mean in practice - your effective and marginal rates, any allowances or thresholds you are close to, and the specific steps to take next. Enter your details above and the guidance updates to match your situation.
Do this next, in order
Estimates only - not financial or tax advice. Confirm figures on GOV.UK or with an adviser.
| Scenario | Sole trader | Company | Winner | |
|---|---|---|---|---|
Sole Trader vs Limited Company Calculator by TaxFly — free UK tax calculators