Salary and dividend mix
We calculate a salary and dividend split using your income, pension contributions and current tax bands, then revisit it after each Budget.
Professional services and contractors
Accountants for consultants, IT contractors and professional services
For consultants, IT contractors and professional advisers running their work through a limited company. We work out your salary, dividends, IR35 position and exit plan together, not as four separate problems at year-end.
- Is this for me?
- If you run your consulting or contracting work through your own limited company (the structure HMRC and the legislation refer to as a personal service company), this page is for you. Whether your current engagement falls inside or outside the off-payroll working rules (commonly known as IR35), both sides of that line are covered here.
- What's covered
- Off-payroll working (IR35) position reviews and the written evidence pack to back them up, salary-and-dividend modelling, regular management accounts, Corporation Tax planning, personal tax returns, and Members' Voluntary Liquidation (MVL) exit planning when the engagement ends.
- What it costs
- A single-director PSC usually fits Band 01 unless there is an MVL or an open status enquiry to deal with. The fees page sets out the bands.
01
02
03
2024 changes
How the salary and dividend balance has changed
For high-earning consultants and contractors operating through their own limited company, the tax position has changed across the last few Budgets.
With the tax-free dividend allowance reduced to £500 and the 26.5% Marginal Relief Corporation Tax band biting between £50,000 and £250,000 of profit, the old low-salary, high-dividend approach no longer reliably saves you tax. The salary-and-dividend split needs checking against the current numbers, allowances, and Corporation Tax bands, not the ones that held when the company was incorporated.
On top of that, HMRC's enforcement of IR35 (Off-Payroll Working) needs written evidence, not assumptions. We review your contracts, working practices and Status Determination Statements (SDS), and prepare the written record that backs an 'Outside IR35' position, so the facts are already documented if HMRC ever has reason to look at them.
How we work with contractors
Your limited company does two things: it invoices your clients, and it decides how much of each fee you take home after tax. The salary level, the dividend tranche, the employer pension contribution and the off-payroll working position all interact, and the right balance shifts every Budget. We focus on what the company pays in tax and what reaches you personally.
IR35 position reviews
IR35 review work for IT contractors and interim managers. We review working practices, contracts and Status Determination Statements so an 'Outside IR35' position is backed by written evidence if it is ever tested.
Director pensions (SIPP)
Employer pension contributions paid directly from the company are a deductible expense, so the contribution reduces Corporation Tax on the way out and lands inside your SIPP without ever passing through the dividend tax bands.
VAT scheme check
Many consultants default to the Flat Rate Scheme. We check your expenses against the Standard Scheme so your VAT returns use the scheme that fits the numbers.
Closing the company (MVL / BADR)
Closing your consultancy or taking a permanent role? We work through Members' Voluntary Liquidation (MVL) and Business Asset Disposal Relief, which can reduce qualifying gains to 10%.
Cloud accounting setup
MTD (Making Tax Digital)-compatible cloud accounting configured for a one- or two-person company, so billable hours, client invoicing and digital bookkeeping run from your phone rather than a year-end spreadsheet.
Frequently asked questions
What is the most tax-efficient way to pay myself?
For limited company directors, the usual starting point is a low salary to protect State Pension entitlement, with dividends taken on top. Dividend allowances and Corporation Tax rates change, so we recalculate the split each tax year instead of carrying last year's figures forward.
Can you help me stay outside IR35?
Yes. We review your working practices, commercial contracts and Status Determination Statements (SDS), and prepare the written evidence pack that supports an 'outside IR35' position if HMRC ever opens an enquiry. Final status always rests on the facts of the engagement. Our job is to make sure those facts are recorded, consistent, and ready.
How do I extract cash if I want to close my consultancy?
If your company has over £25,000 in retained profits and you are taking a permanent PAYE role or ceasing to trade, we can manage a Members' Voluntary Liquidation (MVL). Where Business Asset Disposal Relief (BADR) applies, qualifying gains can be taxed at 10%.
Do consultants need to worry about MTD for Income Tax?
If you operate as a sole-trader consultant with gross turnover above £50,000, yes. You must comply with the 6 April 2026 digital mandate. If you operate through a limited company, you are exempt from this ITSA phase, but digital software still keeps the Corporation Tax work cleaner.
Keep reading
Service
Tax Planning
Salary, dividend and pension modelling to keep more of what the company earns.
ServiceLimited Company Accountants
Full-service accounting for consultants operating through a limited company.
GuideIR35 Explained
The complete guide to IR35 status determination, CEST, and what it means for your contract.
Book an initial consultation
We calculate the salary-and-dividend split, review the off-payroll working position, and plan the eventual exit, all under a fixed fee confirmed before the work begins.
Request your initial consultation