Private dentist on £280,000

Personal Ltd Co. Age 55. Pension preference: aggressive.

Every figure on this page is computed at build time by the same engines that power the live salary–dividend split, take-home and SIPP optimiser calculators. Inputs come from a single CSV row; outputs come from the engines. No static lookup tables, no hand-coded numbers.

Net cash

£120,206

Pension

£60,000

Effective rate

35.6%

Marginal rate

39.4%

The £100,000 cliff catches almost every higher-earning contractor

Before the numbers, a warning: a private dentist at £280,000 of company profit for 2026/27 is sitting close to one of the UK tax code's sharpest cliffs.

This row sits above the £125,140 boundary at which the Personal Allowance is fully eroded. The taper trap is behind you, but the additional-rate threshold (45% income tax / 39.35% dividend tax) is now in play. The next £1 of dividend is taxed at the additional-rate dividend rate of 39.35% — which makes pension contributions (still 0% at the company-contribution level) disproportionately valuable, subject to the £60,000 Annual Allowance and its £260,000 tapered version.

The numbers for this specific scenario

Bottom line for a private dentist at £280,000 of gross income: net cash £120,206; pension £60,000; effective rate on gross 35.6%.

The numbers, line by line

Optimum salary	£5,000
Optimum dividend	£161,775
Optimum pension	£60,000
Net cash (optimum)	£120,206
Net wealth (cash + pension)	£180,206
Rule-of-thumb net cash	£146,959
Rule-of-thumb net wealth	£146,959
Saving vs rule of thumb	£33,246
Effective rate on profit	35.6%
Marginal rate (next £1 dividend)	39.4%
Years to age-57 pension access	2
Annual pension contribution (this row)	£60,000
Projected pot at 57 (5% real, single-path)	£123,000
Sustainable income @ 4% SWR	£4,920/yr

Why this scenario is different

Compared to the closest peer profile — Management consultant at £280,000 — this scenario sits £0 higher on gross income. That moves net cash by +£0, the pension contribution by +£0, and the effective rate by +0%. The effective rate moves only modestly — both scenarios sit inside the same binding tax band. The optimiser shifts £0 of the extraction out of the dividend slice, and £0 out of pension contributions.

Questions this scenario raises

How do I model my partner's income alongside mine?

BracketMath models a single tax entity — there is no joint-couple calculation. For couples, the practical approach is to run each partner separately and consider income-splitting strategies (employing the lower-earning spouse for genuine work performed, sharing dividends if both are shareholders, etc). The Ltd Co spousal share pattern is sketched in /guides/ltd-company-director-tax.

Why does the optimiser pay a salary above £5,000 if employer NI starts there?

Because beyond the £5,000 Secondary Threshold, each £1 of salary still saves 19–25% of corporation tax and only costs 15% in employer NI plus 8% employee NI — a net 11–17% saving up to the £12,570 Personal Allowance. The 2026/27 optimum for this row is £5,000 of salary, sitting in exactly this regime.

How long will my pension pot last?

See the SIPP optimiser at /calculators/sipp-optimiser for a 10,000-path Monte Carlo answer. The widely-cited "4% safe withdrawal rate" comes from US data; the UK historical record produces a lower number (closer to 3.0–3.5%) due to inflation regime differences and slower equity returns. The calculator reports the probability of pot exhaustion explicitly.

How does the Pension Annual Allowance taper work?

Above £260,000 of adjusted income, the £60,000 Annual Allowance reduces by £1 for every £2 over the threshold, down to a £10,000 floor at £360,000 of adjusted income. The taper bites later than the £100k Personal Allowance taper but is similarly punitive on pension contributions specifically.

Are charity donations modelled?

No, not directly. Gift Aid donations reduce adjusted net income (extending the basic-rate band) and are a legitimate way to reclaim the £100k taper marginal. The BracketMath engine does not model them automatically; subtract the gift-aided amount from the "other income" field if you want a closer match.

Methodology

Income tax, National Insurance and Corporation Tax bands taken from HMRC's 2026/27 rates and allowances tables (gov.uk/.../income-tax; corporation-tax). Pension Annual Allowance and taper rules from Finance Act 2004 / 2023. Trading allowance per ITTOIA 2005 s.783A. Voluntary Class 2 figure (£179.40/yr = £3.45/wk × 52) from HMRC voluntary NI guidance.

Style: 2026/27 tax year throughout; figures rounded to whole pounds in the user-facing prose; effective rates computed as (deductions / gross). The voice is methodological — no first person, no claimed credentials, no marketing fluff.

This page is not personalised advice; for advice regulated by the FCA, consult an adviser registered with the Financial Conduct Authority. See the full disclaimer.