GeraJobs / Contractor vs Permanent / £70,000
Contractor vs Permanent on £70,000 (2026/27)
Permanent PAYE: £51,157 net. Outside-IR35 contractor: £52,062 net — £905 more a year.
Contractor vs permanent net on £70,000 in the UK (2026/27)?
At £70,000 equivalent income in 2026/27, a permanent employee nets £51,157 after PAYE, while an outside-IR35 contractor nets about £52,062 (£12,570 salary + dividends after 19% Corporation Tax) — £905 more. Real HMRC rates (OGL v3.0). Simplified model, not tax advice.
Gera Contractor Premium
Extra net pay contracting outside IR35 vs permanent on £70,000, before expenses and lost benefits. Real HMRC 2026/27 rates.
How this is calculatedBreakdown on £70,000
| Permanent — Income Tax | £15,432 |
| Permanent — employee NI | £3,411 |
| Permanent net | £51,157 |
| Contractor — Corporation Tax (19%) | £10,912 |
| Contractor — dividends (gross) | £46,518 |
| Contractor — dividend tax | £7,026 |
| Contractor net | £52,062 |
Contractor vs Permanent Net Calculator (2026/27)
Compare permanent PAYE take-home with an outside-IR35 contractor net (£12,570 director's salary + dividends after 19% Corporation Tax), on real HMRC 2026/27 rates.
Permanent (PAYE)
£51,157
net a year
Contractor (outside IR35)
£52,062
net a year — incl. £10,912 Corp Tax, £7,026 dividend tax
A contractor keeps £905 more a year on these figures — but loses holiday, pension, sick pay and job security, and carries accountancy and IR35 risk.
Simplified model on real HMRC 2026/27 rates. Ignores expenses, VAT, accountancy fees, pension contributions and IR35 status determination. Not personal tax or financial advice.
Other incomes
Contractor vs permanent on £70,000 — FAQ
- What does a permanent employee take home on £70,000?
- £51,157 a year after £15,432 Income Tax and £3,411 employee National Insurance under PAYE (2026/27). Source: HMRC (OGL v3.0).
- What does an outside-IR35 contractor net on £70,000 of billings?
- About £52,062 using a £12,570 director's salary plus £46,518 of dividends after £10,912 Corporation Tax (19%) and £7,026 dividend tax. This is a simplified model on real HMRC rates — it ignores expenses, VAT, accountancy fees and pension. Source: GOV.UK Corporation Tax + dividend rates (OGL v3.0).
- Is contracting worth it at £70,000?
- On these figures a contractor keeps about £905 more a year than a permanent employee, but loses paid holiday, pension contributions, sick pay and job security, and carries accountancy and IR35 risk. This is a model, not advice.
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Sources: HMRC — Income Tax + Class 1 employee NI 2026 to 2027; GOV.UK — Corporation Tax (19% small profits) + Tax on dividends (£500 allowance; 10.75% / 35.75% / 39.35%). All Open Government Licence v3.0. Simplified model — ignores expenses, VAT, accountancy fees, pension and IR35 status. Not personal tax advice.