Salary vs Dividends 2026/27: The Optimal Split for UK Contractors
The most common question every contractor asks. Here's the full calculation: exactly how much to pay yourself in salary, and when to switch to dividends.
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ICAEW Qualified Chartered Accountant · Contractor Specialists · Now Taking On New Clients
The accountant built specifically for UK contractors and limited companies
Fixed monthly fees. No surprises. Practical guidance on salary and dividend planning, IR35 and tax efficiency, from an ICAEW chartered accountant with Big Four training.
Based in Glossop, on the edge of Greater Manchester, working remotely with contractors across the UK.
ICAEW Chartered Accountant
Big Four trained (Deloitte)
FreeAgent specialists
Fixed monthly fees
Remote-first
2026/27
The numbers that matter this tax year
19%
Corporation tax: small profits rate (under £50,000)
26.5%
Marginal CT rate, £50,000–£250,000 profit band
£90k
VAT registration threshold 2026/27: act before you're forced to
£50,270
Higher-rate income tax threshold: dividend planning matters here
£95
Our starting fee: the only number we control
Why Woodcock Accounting Ltd
Built for contractors. By someone who knows the numbers.
We specialise in one thing: UK contractors and freelancers operating through their own limited companies. Everything we do is tuned to your specific structure, risks and opportunities, so you never have to explain contracting basics to your own accountant.
Contractor-first focus
Our processes, templates and advice are built specifically for limited company contractors and freelancers, not adapted from generic small business advice.
Proactive, not reactive
We review your salary and dividend position regularly, keep an eye on director's loan exposure, and plan around corporation tax before your year-end, not after. Higher-tier packages include scheduled reviews; even on Essentials we flag anything that needs attention.
Fully qualified chartered accountant
Run by an ICAEW Chartered Accountant (ACA), Big Four trained. Woodcock Accounting Ltd is an ICAEW member firm and holds professional indemnity insurance in accordance with ICAEW's PII Regulations.
FreeAgent included, often at no extra cost
Most contractors already qualify for FreeAgent completely free through business banking partners (NatWest, Royal Bank of Scotland, Mettle, and others). We use FreeAgent as our core platform, so in most cases there's nothing extra to pay for software; we simply connect as your accountant and work directly in your books.
Fixed fees, clearly scoped
One monthly fee covers everything listed in your package. The scope is clear from day one, and if something falls outside your plan, we'll tell you upfront before any additional cost is incurred. No billing surprises.
Fast, digital, no faff
Remote-first. Onboarding done digitally. Documents exchanged securely. No unnecessary meetings. We respond promptly and handle things without you needing to chase.
Pricing
Three fixed monthly packages.
Clear scope from day one.
From £95/month. Each package clearly sets out what's included, and if anything falls outside your plan, you'll always be told in advance.
Essentials
For contractors whose bookkeeping is under control
£95 / month + VAT
- Annual accounts prepared and filed
- Corporation tax return (CT600)
- Confirmation statement
- Self Assessment tax return for one director
- FreeAgent setup and support
- Quarterly FreeAgent bookkeeping review
- Salary and dividend guidance when you join
- Email support
Most Popular
Standard
The running compliance most contractors need
£155 / month + VAT
- Everything in Essentials
- Limited company formation support for new contractors
- Quarterly VAT returns, standard or Flat Rate, filed under MTD
- Payroll and RTI submissions for one director
- Quarterly salary and dividend review
- Practical IR35 guidance
- Director's loan account monitoring
- Priority email, acknowledged within one business day
Premium
For higher earners and more complex planning needs
£250 / month + VAT
- Everything in Standard
- Annual tax-planning meeting by video call
- Company pension contribution modelling
- Shareholding and profit-extraction planning, where appropriate
- £100,000 income trap planning
- Same-day email acknowledgement
No fixed-term contract, no exit fee and 30 days' written notice. All fees are subject to VAT at the standard rate. Additional work outside the packages (e.g. one-off advisory work) is always quoted and agreed in writing before it starts, with no surprises.
Process
How it works
Simple, digital, and structured from day one.
1
Get in touch
Book a free discovery call or drop us an email. We'll usually come back to you within one business day.
2
Free 30-minute discovery call
A no-obligation call to understand your situation, answer your questions, and confirm which package is right for you. No hard sell.
3
Onboarding & handover
Sign your engagement letter, complete ID checks, authorise HMRC access. We handle the transition, including contacting your previous accountant if needed.
4
We get to work
FreeAgent connected, compliance calendar set up, initial review completed. You'll know exactly where you stand from the first week.
Know another contractor who needs an accountant?
Refer a fellow contractor: when they join, they get 50% off their first month and we credit a month's fee to your account. Simple, fair, and clearly explained.
See how the referral scheme works →Free Guides
Contractor tax, explained clearly
Practical guides written by an ICAEW qualified chartered accountant. No jargon, no upselling. Just the things you actually need to know.
Ready to talk it through?
Book a free 30-minute discovery call and get a clear recommendation for your setup. No obligation, no hard sell.
Book a free discovery call →