AI and ML contractors in the UK typically charge £600–£1,000/day, with the median ML Engineer contract rate at £700/day (ITJobsWatch, Dec 2025). At £700/day (220 working days = £154,000/year), inside IR35 take-home is approximately £90,000–£95,000; outside IR35 via limited company is approximately £108,000–£115,000. IR35 status has a £15,000–£25,000/year impact on take-home. Use our IR35 calculator for exact figures.
Based on 220 working days/year. Inside IR35 figures assume umbrella company arrangement with employer NI deducted from gross. Outside IR35 figures assume limited company with optimised salary/dividend split. Individual figures vary significantly with expenses, pension contributions and personal circumstances.
| Day Rate | Role | Contract Value/yr | Inside IR35 take-home* | Outside IR35 take-home* | IR35 Saving/yr |
|---|---|---|---|---|---|
| £600/day | AI/ML Developer (mid) | £132,000 | ~£78,000 | ~£93,000 | ~£15,000 |
| £700/daymedian | ML Engineer (median rate) | £154,000 | ~£90,000 | ~£108,000 | ~£18,000 |
| £800/day | Senior AI Engineer | £176,000 | ~£103,000 | ~£124,000 | ~£21,000 |
| £900/day | Lead AI/ML Architect | £198,000 | ~£114,000 | ~£138,000 | ~£24,000 |
| £1,000/day | Principal AI Engineer | £220,000 | ~£125,000 | ~£154,000 | ~£29,000 |
* These are approximate estimates. The actual IR35 saving depends on your specific contract, expenses, pension contributions and accountancy fees. Always use the precise IR35 calculator for your situation.
AI and ML contractors command a 60–80% day rate premium over general software contractors (£350–£450/day). London and South East rates are 10–20% above national average.
IR35 determines whether HMRC treats your limited company as a 'disguised employee'. If you're inside IR35, you pay income tax and NI as if employed — losing the limited company tax advantages.
On a £700/day contract (£154,000/year), being inside IR35 costs approximately £18,000/year in additional tax vs outside IR35. Over a 3-year contract, that's £54,000 in extra tax.
IR35 status depends on: right of substitution, control over how work is done, and whether you're integrated into the client's organisation. Use HMRC's CEST tool and our calculator below.