Eleven questions that find what leaks out of your company every year - and what it adds up to.
The working
How this is worked out
Every figure in this tool is a published HMRC amount rather than an estimate. There is no judgement in the numbers themselves, only in whether your circumstances qualify.
| Relief | Amount | Condition |
|---|---|---|
| Use of home as office | £6 per week (£312 a year) | Flat rate, no receipts, no tax either side |
| Business mileage, own car | 45p per mile | First 10,000 miles in the tax year |
| Business mileage, thereafter | 25p per mile | Above 10,000 miles |
| Annual staff event | £150 per head | Per year, VAT inclusive, must be open to all staff |
| Trivial benefits | £50 each | Not cash, not a reward for work |
| Trivial benefits, director cap | £300 per year | Close company directors only |
The annual event limit is a cliff, not an allowance. Spend £151 a head and the entire amount becomes taxable, not just the pound over. The same is true of the £50 trivial benefit limit.
The 60% band, and why it exists
Between £100,000 and £125,140 of income, the personal allowance is withdrawn at £1 for every £2 earned.
On each extra pound in this band you pay: 40% on the pound you earned + 40% on the 50p of allowance it removed = 60% effective marginal rate
It is not a published rate and it appears on no HMRC table, which is exactly why founders walk into it. The band exists because £12,570 of allowance withdrawn at 50p per pound takes precisely £25,140 of income to exhaust, which is what puts the top of the band at £125,140.
A pension contribution that brings adjusted net income back to £100,000 gets relief at that same 60%. For a founder with control over their own dividend timing, it is usually the single highest-value piece of planning available.
The director loan charge
If you owe your own company money and the balance is still outstanding nine months and one day after the year end, the company pays a section 455 charge.
s455 charge = outstanding balance x 35.75%
Two details matter more than the rate itself.
The rate is fixed by the date of the loan, not the date of the year end. It is defined as the dividend upper rate for the tax year in which the loan was made, so it rose from 33.75% to 35.75% on 06/04/2026 alongside dividends. A loan drawn in March 2026 is still charged at 33.75% even on a return filed years later.
It is refundable. Repay the loan and the charge comes back, but not until nine months after the end of the accounting period in which you repaid it. So the money can sit with HMRC for well over a year. It is cash locked up rather than cash lost, which is a much better outcome than most founders fear and a much worse one for cash flow than they expect.
Separately, a balance over £10,000 at any point in the year creates a taxable benefit in kind on the interest you are not paying.
Source: HMRC: loans to participators (CTM61505), checked 2026-08-08.
What changes your answer
- Use of home at more than £6 a week is possible but not simple. Claiming a proportion of actual household costs needs a licence agreement between you and the company and can create personal tax and even a capital gains exposure on your home. The flat rate exists because it avoids all of that.
- Mileage rates are for your own vehicle. A company car is an entirely different regime with its own benefit-in-kind charge based on emissions.
- The annual event must be open to all employees and recurring. A one-off dinner for the founders is not an annual event.
- Trivial benefits cannot be a reward for work or performance, cannot be cash or a cash voucher, and cannot be part of a contractual arrangement.
- Scotland. Scotland sets its own rates and bands on salary. Dividend rates are the same across the UK, but the point at which your dividends tip into the upper rate depends on the salary bands that apply to you, so a Scottish taxpayer can get a different answer from the same inputs.
- This is a checklist, not advice. Every item has qualifying conditions this tool does not test you on.