2026-27 · Tax Guides
Director Tax Guides
Plain-English guides to every aspect of running a UK limited company — salary strategy, IR35, VAT, corporation tax, expenses, payroll and more. All updated for 2026-27.
Tax Planning
Optimal Director Salary for 2026-27
The most tax-efficient director salary for 2026-27 is £12,570. Here's exactly why, and when a lower salary makes sense.
Salary vs Dividends: Which Is More Tax-Efficient?
The classic director question answered with real 2026-27 numbers. When to take salary, when to take dividends, and how to split them optimally.
Dividend Tax Rates 2026-27 Explained
Dividend allowance, basic rate, higher rate, and the additional rate — all 2026-27 rates with examples of how much tax you'll pay.
The £100,000 Personal Allowance Trap Explained
When income exceeds £100,000, the personal allowance tapers creating an effective 60% marginal tax rate. Here's how it works and how to avoid it.
Director Pension Contributions: The Complete Tax Guide
Employer pension contributions are the most tax-efficient way to extract profit from your company. Here's exactly how they work for directors.
How to Extract Profit from Your Company Tax-Efficiently
The complete hierarchy of profit extraction methods for UK directors: salary, dividends, pension, expenses, and loans — ranked by tax efficiency.
Year-End Tax Planning Checklist for Directors
The 10 actions to take before your company year-end and 5-April personal tax deadline to maximise tax efficiency.
IR35
IR35 Explained for Contractors and Directors
What IR35 is, who it applies to, and what happens if you're caught inside. A plain-English guide for solo directors.
The Three IR35 Status Tests Explained
Substitution, control, and mutuality of obligation — how HMRC assesses each test and what your contracts and working practices need to show.
Inside vs Outside IR35: The Financial Difference
Exactly how much more you keep outside IR35 versus inside, with real numbers at £300, £450, and £600 day rates for 2026-27.
Status Determination Statements (SDS) Explained
What an SDS is, who issues it, what it must contain, and what to do if you disagree with an inside IR35 determination.
IR35 Small Company Exemption: Are You Exempt?
Small clients are exempt from the off-payroll working rules. Find out if your client qualifies and what it means for your IR35 position.
VAT
VAT Registration Threshold 2026-27
The VAT registration threshold is £90,000. When you must register, when you can voluntarily register, and whether it's worth it.
VAT Flat Rate Scheme Explained for Directors
The Flat Rate Scheme lets you pay a fixed percentage of turnover instead of calculating VAT on every transaction. Here's how it works and whether it's worth it.
Limited Cost Trader Rule: What It Means for Contractors
If your goods spending is under 2% of turnover, HMRC applies a 16.5% flat rate. Most IT and professional service contractors qualify — here's what to do about it.
VAT Quarterly Returns: What Directors Need to Know
Deadlines, what to include, how to pay, and the Making Tax Digital requirements for VAT-registered directors.
Corporation Tax
Corporation Tax Rates 2026-27: Small Profits, Marginal Relief, and Main Rate
Corporation tax rates for 2026-27 explained — 19% small profits rate, 25% main rate, and the 26.5% marginal band between £50k and £250k.
Allowable Expenses for Corporation Tax
What expenses your company can deduct before calculating its corporation tax bill — the HMRC 'wholly and exclusively' rule applied to common director costs.
Capital Allowances and the Annual Investment Allowance
How capital allowances work, the £1 million Annual Investment Allowance, and how to time equipment purchases to maximise your corporation tax deduction.
Expenses
Allowable Expenses for UK Directors: The Complete Guide
Every expense category a UK solo director can legitimately claim through their company, with HMRC guidance references and practical tips.
Home Office Expenses for Directors: Flat Rate vs Apportioned
Directors working from home can claim £6/week flat rate or the apportioned actual cost method. Here's how to choose and calculate each.
Mileage Allowance Rates 2026-27
HMRC's approved mileage rates for 2026-27 — 45p for the first 10,000 miles, 25p after. How to claim, what counts as business mileage, and the electric car rate.
Payroll & NI
Employer National Insurance 2026-27: The April 2025 Changes Explained
Employer NI rate rose to 15% from April 2025, with the threshold dropping to £5,000. What this means for director salary planning.
Employment Allowance 2026-27: £10,500 Explained
The Employment Allowance is £10,500 for 2026-27. Who can claim it, who can't, and how it changes your optimal salary strategy.
Setting Up Payroll as a Company Director
How to register as an employer, set up RTI payroll, and run your director salary through PAYE correctly — step by step.
Director's Loan Account: Tax Implications Explained
What a director's loan account is, when S455 tax applies, the £10,000 BIK threshold, and how to manage overdrawn loan accounts correctly.
Companies House
Filing Annual Accounts: Deadlines and Requirements for Directors
When company accounts must be filed, what they must contain, and the penalties for filing late.
Confirmation Statement: Annual Filing Guide for Directors
The confirmation statement replaced the annual return in 2016. Here's what it covers, when it's due, and how to file it.
Companies House Late Filing Penalties
The penalties for filing company accounts late — and how to appeal if you have a reasonable excuse.
Making Tax Digital
Making Tax Digital for Income Tax (MTD ITSA) — What Directors Need to Know
MTD ITSA is being phased in from April 2026. Directors with self-employment or property income above £50,000 are affected first. Here's what changes.
Making Tax Digital for VAT: What Directors Need to Know
MTD for VAT has been mandatory for all VAT-registered businesses since April 2022. Here's what it requires and how to stay compliant.
Banking & Accounts
Accounting Software for UK Directors: FreeAgent vs Xero vs QuickBooks
The three main MTD-compatible accounting packages compared — features, pricing, and which is best for UK solo directors.
Bookkeeping Basics for UK Directors
What records you must keep, how long to keep them, and a simple monthly bookkeeping routine that keeps your company compliant.
Strategy
Forming a Limited Company: Step-by-Step Guide
How to form a UK limited company, what you'll need, the costs involved, and what to do in the first 30 days after incorporation.
Sole Trader vs Limited Company: Which Is Better?
A full comparison of tax costs, admin, liability, and credibility — with real numbers showing when a limited company becomes worth it.
Use the calculators
Put the theory into practice with our interactive tax tools — all updated for 2026-27.
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