Act on the result
Confirm the engagement status and payroll basis externally before using the cost gap in a commercial rate discussion.
Educational only: Business decision support, not accounting, tax or legal advice.
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Update policy: Reviewed when formulas or official dependencies change.
Scope: UK small-business planning using your own assumptions.
What this comparison calculator helps you decide
Best for
UK businesses comparing two already-confirmed off-payroll commercial cost scenarios.
Outputs
Outside and inside client cost, signed cost gap and the inside deemed rate that matches outside cost.
Start here
Confirm the same engagement scope, then enter days, service fee, deemed payment, employer on-cost and fixed costs.
Use a different tool when: Do not use this to set a viable rate and project quote; use Service Rate & Quote Planner for that decision. Use this tool to compare two user-confirmed off-payroll commercial cost scenarios without determining status.
Price & margin
UK Inside vs Outside IR35 Rate: outside and inside client cost
Outside and inside client cost, signed cost gap and the inside deemed rate that matches outside cost.
Confirmed comparison scope
Compare two user-confirmed VAT-exclusive commercial cost scenarios without determining employment status, VAT treatment or worker take-home pay.
Your numbers stay in this browser
Use the same engagement days for both scenarios.
Commercial service fee before VAT; this is not a status conclusion.
Procurement, onboarding or administration cost before VAT.
User-confirmed VAT-exclusive gross payment basis before worker PAYE deductions; Margin101 does not deduct VAT or infer a tax rate.
Enter the combined employer National Insurance, levy and other applicable employer-cost rate supplied by payroll or an adviser.
VAT-exclusive payroll, agency or administration cost not already included in the entered on-cost rate.
Confirm both hypothetical scenarios cover the same engagement and billable days, with every rate and fixed client cost entered excluding VAT.
Bounded comparison result
See the client-cost gap and the inside-scenario deemed payment rate that would match the outside commercial cost.
- Outside-scenario total client cost excluding VAT
- £145,000
- Inside-scenario deemed direct payment excluding VAT
- £118,800
- Inside-scenario employer on-cost
- £17,820
- Inside-scenario total client cost excluding VAT
- £139,620
- Inside minus outside client cost excluding VAT
- -£5,380
- Inside deemed rate matching outside cost
- £561
- Inside deemed rate threshold state
- Reachable within the non-negative rate range
- Inside fixed-cost excess over outside cost
- £0
This does not determine IR35 status or estimate take-home pay. Use the client SDS, HMRC CEST and professional advice.
Scenario comparison
Each row names the assumption axis changed from the baseline.
ScenarioResultDifference
Entered scenario-£5,380.00Baseline
Driver −10%-£19,042.00-£13,662.00
Driver +10%£8,282.00£13,662.00
Save these results, change an input, then compare the updated figures with this baseline.
The baseline is temporary in this tab and is not added to shared scenario links or generated reports.
Calculation details
View calculation detailsView the formulas and inputs used for these results.
Outside-scenario total client cost excluding VAT
Outside-scenario total client cost excluding VAT
service fees + outside fixed cost£145,000.00Result£145,000
Commercial client-cost comparison only; it does not determine status or worker tax. The engine retains full precision; display rounding never feeds calculation.
UK Inside vs Outside IR35 Rate Comparison formulas →Inputs used by these formula steps
- Outside-scenario total client cost excluding VATBillable Days
- 220
- Outside-scenario total client cost excluding VATOutside Service Day Rate Ex Vat
- 650
- Outside-scenario total client cost excluding VATOutside Client Fixed Cost Ex Vat
- 2,000
- Outside-scenario total client cost excluding VATInside Deemed Payment Per Day
- 540
- Outside-scenario total client cost excluding VATInside Employer On Cost Rate
- 0.15
- Outside-scenario total client cost excluding VATInside Client Fixed Cost
- 3,000
- Outside-scenario total client cost excluding VATComparison Scope Confirmed
- 1
Inside-scenario deemed direct payment excluding VAT
Inside-scenario deemed direct payment excluding VAT
billable days × deemed payment per day£118,800.00Result£118,800
Commercial client-cost comparison only; it does not determine status or worker tax. The engine retains full precision; display rounding never feeds calculation.
UK Inside vs Outside IR35 Rate Comparison formulas →Inputs used by these formula steps
- Inside-scenario deemed direct payment excluding VATBillable Days
- 220
- Inside-scenario deemed direct payment excluding VATOutside Service Day Rate Ex Vat
- 650
- Inside-scenario deemed direct payment excluding VATOutside Client Fixed Cost Ex Vat
- 2,000
- Inside-scenario deemed direct payment excluding VATInside Deemed Payment Per Day
- 540
- Inside-scenario deemed direct payment excluding VATInside Employer On Cost Rate
- 0.15
- Inside-scenario deemed direct payment excluding VATInside Client Fixed Cost
- 3,000
- Inside-scenario deemed direct payment excluding VATComparison Scope Confirmed
- 1
Inside-scenario employer on-cost
Inside-scenario employer on-cost
deemed direct payment × entered employer on-cost rate£17,820.00Result£17,820
Commercial client-cost comparison only; it does not determine status or worker tax. The engine retains full precision; display rounding never feeds calculation.
UK Inside vs Outside IR35 Rate Comparison formulas →Inputs used by these formula steps
- Inside-scenario employer on-costBillable Days
- 220
- Inside-scenario employer on-costOutside Service Day Rate Ex Vat
- 650
- Inside-scenario employer on-costOutside Client Fixed Cost Ex Vat
- 2,000
- Inside-scenario employer on-costInside Deemed Payment Per Day
- 540
- Inside-scenario employer on-costInside Employer On Cost Rate
- 0.15
- Inside-scenario employer on-costInside Client Fixed Cost
- 3,000
- Inside-scenario employer on-costComparison Scope Confirmed
- 1
Inside-scenario total client cost excluding VAT
Inside-scenario total client cost excluding VAT
deemed direct payment + employer on-cost + inside fixed cost£139,620.00Result£139,620
Commercial client-cost comparison only; it does not determine status or worker tax. The engine retains full precision; display rounding never feeds calculation.
UK Inside vs Outside IR35 Rate Comparison formulas →Inputs used by these formula steps
- Inside-scenario total client cost excluding VATBillable Days
- 220
- Inside-scenario total client cost excluding VATOutside Service Day Rate Ex Vat
- 650
- Inside-scenario total client cost excluding VATOutside Client Fixed Cost Ex Vat
- 2,000
- Inside-scenario total client cost excluding VATInside Deemed Payment Per Day
- 540
- Inside-scenario total client cost excluding VATInside Employer On Cost Rate
- 0.15
- Inside-scenario total client cost excluding VATInside Client Fixed Cost
- 3,000
- Inside-scenario total client cost excluding VATComparison Scope Confirmed
- 1
Inside minus outside client cost excluding VAT
Inside minus outside client cost excluding VAT
inside total client cost − outside total client cost-£5,380.00Result-£5,380
Commercial client-cost comparison only; it does not determine status or worker tax. The engine retains full precision; display rounding never feeds calculation.
UK Inside vs Outside IR35 Rate Comparison formulas →Inputs used by these formula steps
- Inside minus outside client cost excluding VATBillable Days
- 220
- Inside minus outside client cost excluding VATOutside Service Day Rate Ex Vat
- 650
- Inside minus outside client cost excluding VATOutside Client Fixed Cost Ex Vat
- 2,000
- Inside minus outside client cost excluding VATInside Deemed Payment Per Day
- 540
- Inside minus outside client cost excluding VATInside Employer On Cost Rate
- 0.15
- Inside minus outside client cost excluding VATInside Client Fixed Cost
- 3,000
- Inside minus outside client cost excluding VATComparison Scope Confirmed
- 1
Inside deemed rate matching outside cost
Inside deemed rate matching outside cost
(outside cost − inside fixed cost) / days / (1 + on-cost rate)£561.26Result£561
Commercial client-cost comparison only; it does not determine status or worker tax. The engine retains full precision; display rounding never feeds calculation.
UK Inside vs Outside IR35 Rate Comparison formulas →Inputs used by these formula steps
- Inside deemed rate matching outside costBillable Days
- 220
- Inside deemed rate matching outside costOutside Service Day Rate Ex Vat
- 650
- Inside deemed rate matching outside costOutside Client Fixed Cost Ex Vat
- 2,000
- Inside deemed rate matching outside costInside Deemed Payment Per Day
- 540
- Inside deemed rate matching outside costInside Employer On Cost Rate
- 0.15
- Inside deemed rate matching outside costInside Client Fixed Cost
- 3,000
- Inside deemed rate matching outside costComparison Scope Confirmed
- 1
Inside deemed rate threshold state
Inside deemed rate threshold state
unreachable fixed-cost floor when inside fixed cost exceeds total outside costreachableResultReachable within the non-negative rate range
Commercial client-cost comparison only; it does not determine status or worker tax. The engine retains full precision; display rounding never feeds calculation.
UK Inside vs Outside IR35 Rate Comparison formulas →Inputs used by these formula steps
- Inside deemed rate threshold stateBillable Days
- 220
- Inside deemed rate threshold stateOutside Service Day Rate Ex Vat
- 650
- Inside deemed rate threshold stateOutside Client Fixed Cost Ex Vat
- 2,000
- Inside deemed rate threshold stateInside Deemed Payment Per Day
- 540
- Inside deemed rate threshold stateInside Employer On Cost Rate
- 0.15
- Inside deemed rate threshold stateInside Client Fixed Cost
- 3,000
- Inside deemed rate threshold stateComparison Scope Confirmed
- 1
Inside fixed-cost excess over outside cost
Inside fixed-cost excess over outside cost
max(0, inside fixed cost − outside total client cost)£0.00Result£0
Commercial client-cost comparison only; it does not determine status or worker tax. The engine retains full precision; display rounding never feeds calculation.
UK Inside vs Outside IR35 Rate Comparison formulas →Inputs used by these formula steps
- Inside fixed-cost excess over outside costBillable Days
- 220
- Inside fixed-cost excess over outside costOutside Service Day Rate Ex Vat
- 650
- Inside fixed-cost excess over outside costOutside Client Fixed Cost Ex Vat
- 2,000
- Inside fixed-cost excess over outside costInside Deemed Payment Per Day
- 540
- Inside fixed-cost excess over outside costInside Employer On Cost Rate
- 0.15
- Inside fixed-cost excess over outside costInside Client Fixed Cost
- 3,000
- Inside fixed-cost excess over outside costComparison Scope Confirmed
- 1
Inputs used
- Billable days
- 220
- Outside-scenario service day rate
- 650
- Outside-scenario client fixed cost
- 2,000
- Inside-scenario deemed payment per day excluding VAT
- 540
- Inside-scenario employer on-cost rate
- 0.15
- Inside-scenario client fixed cost excluding VAT
- 3,000
- Same engagement and VAT-exclusive basis confirmed
- 1
Open this calculator with preset values
This calculator supports documented, shareable scenario URLs. Compatible assistants and applications can construct links using the parameters below.
Scenario links contain only allowlisted numeric and closed-choice inputs shown in the URL; Margin101 excludes free text and identifying fields. Anyone you share the URL with can read those numbers, so do not include private or identifying data.
| Parameter | Meaning | Unit | Allowed values | Presence | Default |
|---|---|---|---|---|---|
| billableDays | Use the same engagement days for both scenarios. | billable days/engagement | 1 to 366 | Required | 220 |
| comparisonScopeConfirmed | Confirm both hypothetical scenarios cover the same engagement and billable days, with every rate and fixed client cost entered excluding VAT. | — | 0 (No), 1 (Yes) | Required | Yes |
| insideClientFixedCost | VAT-exclusive payroll, agency or administration cost not already included in the entered on-cost rate. | GBP/engagement, ex VAT | 0 to 10000000 | Required | 3000 |
| insideDeemedPaymentPerDay | User-confirmed VAT-exclusive gross payment basis before worker PAYE deductions; Margin101 does not deduct VAT or infer a tax rate. | GBP/billable day, ex VAT and before worker PAYE deductions | 0 to 10000000 | Required | 540 |
| insideEmployerOnCostRate | Enter the combined employer National Insurance, levy and other applicable employer-cost rate supplied by payroll or an adviser. | decimal employer on-cost per GBP of deemed direct payment | 0 to 1 | Required | 0.15 |
| outsideClientFixedCostExVat | Procurement, onboarding or administration cost before VAT. | GBP/engagement, ex VAT | 0 to 10000000 | Required | 2000 |
| outsideServiceDayRateExVat | Commercial service fee before VAT; this is not a status conclusion. | GBP/billable day, ex VAT | 0 to 10000000 | Required | 650 |
UK Inside vs Outside IR35 Rate: outside and inside client cost
This compares user-confirmed commercial scenarios; it never determines IR35 status or worker take-home tax.
Formula summary
- Primary formula
- inside total client cost − outside total client cost
Data used here
- UK off-payroll commercial comparison boundary: HM Revenue & Customs; verified; checked 2026-07-28.
Decision checks
Stress-test the decision
Retest billable days, employer on-cost and fixed cost separately while preserving the same engagement scope.
Assumptions and sources
- UK off-payroll commercial comparison boundary
- HMRC off-payroll status and deemed-employer responsibilities guidance Checked 2026-07-28.
Primary source →
When this estimate can be misleading
- This workflow compares only the bounded, explicitly confirmed scope shown in the inputs.
- It does not determine employment status, PAYE, National Insurance, take-home pay or legal rights.
- Unsupported or uncertain cases stop instead of using a guessed policy rule.
- Confirm the decision with the relevant authority or a qualified adviser.
- This compares user-confirmed commercial scenarios; it never determines IR35 status or worker take-home tax.
Educational estimate, not advice. See all assumptions & limitations →
Related reading
Guides to interpret the decision and its assumptions.
- UK IR35 Rate Comparison: Confirmed Status to Quote
Compare same-scope client-side costs after external status confirmation, then carry the reviewed commercial rate into a service quote.
Read guide
Frequently asked questions
How do I compare two user-confirmed off-payroll commercial cost scenarios without determining status?
Confirm the engagement status and payroll basis externally before using the cost gap in a commercial rate discussion.
What should stay consistent when I compare the options?
Keep the time basis, units and included costs consistent across options, then verify the assumptions that create the largest difference.