How much tax do I pay inside IR35?

Your fee income is taxed like a salary under the 2026/27 bands: 0% up to £12,570, 20% up to £50,270, 40% up to £100,000, an effective 60% between £100,000 and £125,140 while the personal allowance is withdrawn, then 45% above that. Class 1 employee National Insurance is added on top at 8% between £12,570 and £50,270, then 2% above £50,270.

What's the difference between being paid via agency PAYE or an umbrella company inside IR35?

Under agency PAYE, the agency itself operates PAYE on your invoice value. Under an umbrella company, the umbrella employs you, deducts its margin, employer National Insurance and any apprenticeship levy contribution from the assignment rate first, and then runs PAYE on what's left — so the same headline day rate can produce a different take-home depending on the route and the umbrella's margin.

Is this calculator up to date for 2026/27?

Yes — it uses the 2026/27 income tax bands and the current Class 1 employee National Insurance rates (8% and 2%), so figures reflect thresholds that have been frozen rather than rising with inflation.

Can I model a day rate rather than an hourly rate?

Yes, you can enter either a day rate with billable days per year, or an hourly rate with weekly hours — the calculator annualises whichever you enter before applying tax and National Insurance.

Inside IR35 Calculator 2026/27 – Take-Home Pay from Your Day Rate

What you actually take home working inside IR35

When a contract is inside IR35, your fee is taxed broadly as if you were an employee of the fee-payer, whether that's an agency operating PAYE directly or an umbrella company that employs you and invoices the agency or client. For 2026/27, that means the standard income tax bands and Class 1 employee National Insurance (8% between £12,570 and £50,270, then 2% above) apply to your earnings, alongside employer costs — employer National Insurance at 15% above the £5,000 secondary threshold and an apprenticeship levy contribution — that are typically factored into the rate you're offered rather than being visible on your payslip.

How to use this calculator

Enter your day or hourly rate and the number of billable hours or days you expect to work
Choose whether you're paid via agency PAYE or an umbrella company — the calculator flags where an umbrella margin and holiday pay treatment change the numbers
Add pension contributions (including salary sacrifice, if your umbrella or agency offers it) and your student loan plan, if applicable
Review the breakdown of income tax, employee National Insurance and any umbrella margin against your gross fee income

Inside IR35 Take-Home Pay Calculator (2026/27)

What you actually take home working inside IR35

How to use this calculator

Frequently asked questions