Contractor Day Rate to Salary Calculator
Find out what your contractor day rate equals as an annual salary and compare PAYE take-home against a Ltd Company structure. Based on 220 working days per year (contractor realistic). 2025-26 tax year.
How the comparison works
Day rate × 220 days. This is your annual gross equivalent — what a permanent employee would earn to match your billing rate.
Full income tax + National Insurance on the gross annual equivalent. This is what you'd take home as a permanent employee (or inside IR35).
Salary at £12,570 (personal allowance) + dividends from remaining profit after corporation tax. Dividend tax at 8.75%/33.75%.
Contractors typically bill fewer days than a full 260-day employee year — accounting for holidays, sick days, bench time, and admin. 220 days is a realistic contractor figure.
Day rate to salary — all rates 2025-26
| Day rate | Annual gross | PAYE net | Ltd Co net | Ltd advantage | |
|---|---|---|---|---|---|
| £200/day | £44,000 | £35,200 | £35,005 | £-195 | View → |
| £250/day | £55,000 | £42,457 | £43,135 | £678 | View → |
| £300/day | £66,000 | £48,837 | £50,112 | £1,275 | View → |
| £350/day | £77,000 | £55,217 | £55,468 | £251 | View → |
| £400/day | £88,000 | £61,597 | £60,825 | £-772 | View → |
| £450/day | £99,000 | £67,977 | £66,181 | £-1,796 | View → |
| £500/day | £110,000 | £72,357 | £71,537 | £-820 | View → |
| £550/day | £121,000 | £76,219 | £76,894 | £675 | View → |
| £600/day | £132,000 | £81,117 | £82,250 | £1,133 | View → |
| £650/day | £143,000 | £86,947 | £87,606 | £659 | View → |
| £700/day | £154,000 | £92,777 | £92,962 | £185 | View → |
| £750/day | £165,000 | £98,607 | £98,319 | £-288 | View → |
| £800/day | £176,000 | £104,437 | £103,675 | £-762 | View → |
| £850/day | £187,000 | £110,267 | £109,031 | £-1,236 | View → |
| £900/day | £198,000 | £116,097 | £114,388 | £-1,709 | View → |
| £1,000/day | £220,000 | £127,757 | £125,100 | £-2,657 | View → |
| £1,100/day | £242,000 | £139,417 | £135,813 | £-3,604 | View → |
| £1,200/day | £264,000 | £151,077 | £146,528 | £-4,549 | View → |
| £1,500/day | £330,000 | £186,057 | £179,322 | £-6,735 | View → |
Based on 220 billable days/year. Ltd Co assumes: £12,570 salary, 19%/25% corporation tax, 8.75%/33.75% dividend tax. Estimates only.
Up to £550/day
£600/day and above
Is your day rate a good salary equivalent?
A contractor on £500/day working 220 days generates £110,000 in annual revenue. As a permanent employee on the same gross, PAYE take-home would be £72,357. Through a limited company outside IR35, the take-home rises to £71,537 — a difference of £-820.
Contractors also need to account for costs a permanent employee doesn't have: accountancy fees, professional indemnity insurance, public liability insurance, business bank account fees, and periods without paid work. A common rule of thumb is to add 20–30% on top of the equivalent permanent salary when comparing contractor rates.
IR35 matters: if your engagement is deemed inside IR35, you pay full PAYE on your invoiced revenue — matching the PAYE column in the table above. See the IR35 calculator for the full picture.