Calculator · UK 2025/26
Locum Structure Comparison
Sole trader vs limited company vs umbrella for a locum dentist. Annual net take-home with the winning structure highlighted.
Your inputs
On your figures, Sole Trader wins
£54,632
Annual net take-home under the winning structure.
Sole Trader
Best£54,632
net of all tax + cost
Total tax + cost: £20,368
Limited Company
£53,014
net of all tax + cost
Total tax + cost: £21,986
Umbrella
£49,758
net of all tax + cost
Total tax + cost: £31,242
Notes: Indicative UK 2025/26 model. Ltd-co assumes £12,570 salary + remainder as dividend, £1,800 admin cost, no Employment Allowance (single-director restriction). Umbrella assumes 5% margin retention. None of the models include NHS Pension implications — sole-trader locums can join the practitioner pensions arrangement straightforwardly, Ltd-co locums have more restrictive access, umbrella locums are typically limited to the employer's auto-enrolment scheme.
IR35 not modelled here. If the engaging practice issues an inside-IR35 SDS, Ltd-co receives net of deductions and dividend extraction isn't available on that engagement. The comparison shifts towards umbrella or sole-trader.
Frequently asked
- When does a limited company beat sole-trader for a locum?
- Typically once sustainable locum income exceeds around £80,000-£100,000 and the engagements aren't all inside IR35. Below that, the £1,800-£2,500 of annual Ltd-co admin cost plus the more restrictive NHS Pension access often makes sole-trader the better answer. The calculator gives the directional number on your actual figures.
- What does the calculator assume about IR35?
- The Ltd-co model assumes engagements are outside IR35 (or fee-payer is small business exempt). If the engaging practice is medium/large and issues an inside-IR35 SDS, the practice operates PAYE-style deductions on your fees and the dividend extraction route disappears. Net take-home in that case is closer to umbrella than the calculator's Ltd-co figure.
- Why is umbrella usually the worst option for sustained locuming?
- Umbrellas charge a margin (5-7% typically), expenses are very restricted under IR35, and you're employed on PAYE so all income attracts employee + employer NI. Convenient and low-admin for short or low-volume locuming; rarely the most tax-efficient for sustained work above £40,000-£50,000.
Want the full structure review?
The calculator gives a directional answer. The right structure also depends on your NHS Pension goals, IR35 mix across engagements, and longer-term position.