Paying yourself from your own company
When you own and run a limited company, the company and you are taxed separately, and how money moves between you decides the total. These guides show the working for 2026/27 salaries, dividends and director's loans.
3 guides in this subject
Every guide in your own company
With a £12,570 salary, £40,000 of dividends costs £4,821.25 in tax in 2026/27. Here is which slice lands in which band, and when it is paid.
For a sole director with no Employment Allowance, a £12,570 salary still comes out ahead of £6,708 after employer National Insurance. Worked in full for 2026/27.
If you still owe your company money nine months after its year end, the company pays a temporary 35.75% tax on it. Worked for a £25,000 balance at 31 March 2027.
Common questions
10.75% in the basic rate band, 35.75% in the higher rate band and 39.35% above £125,140. The first £500 of dividends is taxed at 0%.
No. If the director is the only employee paid above the £5,000 secondary threshold, the company cannot claim it.