UK Self-Employed Tax Calculator
Work out your Income Tax and Class 4 National Insurance as a UK sole trader or self-employed freelancer. Includes payments on account estimate and "% to set aside" for every invoice you receive.
Your tax bill
Full breakdown
| Revenue | £0 |
| − Expenses | £0 |
| = Profit (taxable) | £0 |
| − Income Tax | £0 |
| − Class 4 NI | £0 |
| − Student loan | £0 |
| = Net income | £0 |
Self Assessment cash flow
| Balancing payment (31 Jan) | £0 |
| 1st payment on account (31 Jan) | £0 |
| 2nd payment on account (31 Jul) | £0 |
| Total due in January | £0 |
Effective tax rate: 0%. Class 2 NI no longer charged from 2024/25 where profits exceed the Small Profits Threshold.
How UK sole trader tax works
As a self-employed sole trader in the UK, you pay two things on your profits (revenue minus allowable expenses), not on your revenue:
- Income Tax — same bands as an employee: 0% up to £12,570, 20% to £50,270, 40% to £125,140, 45% above.
- Class 4 National Insurance — 6% on profits between £12,570 and £50,270, then 2% above.
You may also owe a small amount of Class 2 NI — but from 2024/25 onwards, HMRC removed the actual charge (you still get state pension credit automatically once your profits pass the Small Profits Threshold of £6,725).
The 30% rule
A useful rule of thumb: set aside about 30% of every invoice into a separate savings account as soon as it's paid. That covers Income Tax + Class 4 NI comfortably for basic-rate earners. If you're a higher-rate taxpayer, closer to 40%. This calculator shows you the exact percentage for your situation.
Payments on account
If your Self Assessment bill is over £1,000, HMRC asks you to prepay next year's tax in two instalments: 31 January (with your balancing payment) and 31 July. So your first tax bill often feels like 150% of the year's actual tax. It's not extra — it's just paid up front.
Related calculators
- Freelance rate calculator — set your hourly rate before you invoice.
- UK take-home pay (PAYE) — compare with what you'd earn on payroll.
- VAT calculator — add or remove VAT once you're registered.
- Markup & margin calculator — for pricing your services or products.
Frequently asked questions
What's the difference between Class 2 and Class 4 National Insurance?
Class 2 is a flat weekly amount historically paid by sole traders with profits above the Small Profits Threshold. From 2024/25, HMRC removed the requirement to pay Class 2 — you now get credit towards your state pension automatically once profits exceed the threshold, without owing the flat rate. Class 4 is a percentage of profits above the lower profit limit, paid alongside Income Tax through Self Assessment.
What tax year does this calculator use?
The 2024/25 tax year rates. Personal allowance £12,570, basic rate 20% up to £50,270, higher rate 40% up to £125,140, additional rate 45% above. Class 4 NI is 6% on profits £12,570–£50,270 and 2% on profits above. Class 2 is no longer charged where profits exceed the SPT. Always double-check gov.uk before filing your return.
How do I use this if I have PAYE income too?
This calculator assumes self-employment is your only income. If you also have a job (PAYE), your personal allowance is used up by that salary first, and your self-employed profits stack on top at your marginal rate. In that case, your self-employed profits could be taxed at 40% from the first pound. HMRC works this out on your Self Assessment automatically.
What are payments on account?
If your Self Assessment tax bill is over £1,000, HMRC asks you to pay half of next year's estimated bill by 31 January and the other half by 31 July — on top of the balance for the year you're filing. So your first Self Assessment can feel like 150% of the year's actual bill. This calculator shows you the estimated payments on account so you can plan cash flow. It's not extra tax, just early payment.
What about VAT?
You must register for VAT once your taxable turnover crosses £90,000 in any rolling 12 months. VAT is separate from Income Tax and NI — it doesn't reduce your profits, but it does add admin. This calculator handles Income Tax + NI only. Use the VAT calculator for gross/net conversions once you're registered.
Should I set money aside as I earn?
Yes — a common rule for UK sole traders is to move 25–30% of every invoice into a separate 'tax pot' account as soon as it's paid. That covers Income Tax + Class 4 NI at basic-rate levels with a small buffer. Higher earners should aim for 35–45%. This calculator shows your effective rate so you know exactly what to set aside.