KiQiCulators

Two directors: £12,570 each or £30,000 each?

Two directors in one company, such as a couple: compare small salaries plus dividends with bigger salaries, and see the money left for the family and the total tax paid.

🇬🇧 For UK taxpayers onlyTax yearI live in

Your company

Is your profit before or after the directors' wages?

Company profit a year, before paying the directors

Sales less running costs, before directors' salaries, employer NI and corporation tax. Take it from your last accounts or bookkeeping.

Employer NI on other staff a year (not the directors)

Other employees' wages should already be taken off the profit above. Their employer NI uses up the £10,500 Employment Allowance first, so less is left for the directors.

Who owns the shares?

The salaries to compare

Compare Option A with

Option A: salary each

Option B: salary each

Option C: your salary

Option C: partner's salary

Dividends

How much do you take out as dividends?

Dividends to take a year, in total

Pension

The directors pay into a pension

Other income

Your other income a year

Your partner's other income

Jobs or pensions outside the company. They use up allowances and bands first.

One of you has rental income One of you has savings interest You claim Child Benefit The directors work from home

Which salaries pay the least tax?

Family take-home a year, and profit still in the company

Find the lowest-tax mix

Salary each

Dividends a year, in total

Total tax leakage: every tax paid

How each one is worked out

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The same work two ways: sole trader against your own Ltd company, with running costs, use of home, CIS, rent and savings, the total tax each way and the point where a company starts to pay.

Payslip and salary

See what you take home after income tax, National Insurance, student loan and pension. Compare two salaries side by side.

P60 and tax refund

Put in the figures from your P60 or last payslip and see if HMRC owes you a refund or you still owe tax, with Gift Aid, mileage, uniform and work costs added in.

Self-employed

Your income tax, Class 4 National Insurance and the dates to pay HMRC, with payments on account worked out for you.

CIS

Contractors take 20% (or 30%) off your labour. See your real tax bill and whether HMRC owes you a refund.

Company director

Work out the best mix of salary and dividends for 2026/27, with corporation tax, dividend tax and the dates to pay.

Compare

Put the same money through three ways of working and see which leaves you the most.

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How it is worked out

Each director pays income tax and National Insurance on their salary through PAYE.
Employer NI is 15% on each salary above £5,000. With two directors both paid over £5,000, the company can claim the £10,500 Employment Allowance.
Salaries and employer NI cut the profit, so the company pays less corporation tax (19% to 25%).
Dividends go to the shareholders in line with their shares, after corporation tax. A spouse who is a director but owns no shares gets no dividends.

Questions people ask

Is £12,570 or £30,000 salary better for two directors?

It depends on the profit and who owns the shares. A bigger salary costs income tax and NI but saves corporation tax at up to 25%, and the Employment Allowance can cover the employer NI. The calculator shows both side by side.

Can my wife or husband be paid £30,000 if they are a director?

Only if the pay is fair for the work they do for the company. HMRC can challenge salaries that are too high for the work, so keep records of what they do.

Who gets the dividends?

Dividends are paid to shareholders in line with their shares. If you own 100% of the shares, all dividends are yours and taxed on you.

Want the real numbers?

These are estimates. Talk to a KiQi accountant about your own situation and the best way to pay yourself.

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Estimates only, for UK taxpayers in England, Wales, Scotland and Northern Ireland, using the rates for the tax year you pick at the top. Nothing you type leaves your browser. Not financial advice.