Skip to content
FinanceWith Ease
Change country: United Kingdom

Choose your country

Australia Canada Ireland New Zealand United Kingdom United States

Self-Employed Tax Calculator

Enter your self-employed income and expenses to see the Income Tax, National Insurance and student loan you'll pay as a sole trader, and how much is due on 31 January and 31 July.

Tax return due 31 January 2027

£

Your turnover for the tax year

£

Profit £40,000

More options· Job, student loan, payments already made
£

Taxed through PAYE, per year

£

For 2025/26

Tax to pay for 2025/26

£7,132

18% of your £40,000 profit

Income Tax
£5,486
Class 4 National Insurance
£1,646
Where your profit goes
  • You keep£32,868
  • Income Tax£5,486
  • National Insurance£1,646

Due by 31 January 2027: £10,698 including your first payment on account

What this means

No one takes tax from your pay as you go, so it’s all due after the tax year ends. Put about 18% of everything you earn into a separate account as it comes in.

Because your bill is over £1,000, you also pay half of next year’s tax in advance (“payments on account”), so your first January bill is bigger than this year’s tax alone.

Next step

Breakdown

Per year
Self-employed income£45,000.00
Expenses-£5,000.00
Income Tax-£5,486.00
Class 4 National Insurance-£1,645.80
You keep£32,868.20

When to pay

31 January 20272025/26 balance £7,132 + first payment on account £3,566£10,697.70
31 July 2027Second payment on account£3,565.90

Payments on account are advance payments towards next year’s bill, each half of this year’s Income Tax and Class 4.

Assumptions in this estimate
  • Class 2 National Insurance is no longer charged: profits over £6,845 earn National Insurance credits automatically, and below that you can pay £3.50 a week voluntarily.
  • Assumes your self-employed profit and any salary are your only income; dividends, savings, property income and pension contributions are not included.
  • Profits are taxed in the tax year they’re made (basis period reform, from 2024/25).
  • Payments on account for next year are based on this year’s bill. If you expect lower profits, you can ask HMRC to reduce them.
Spotted a mistake? Tell us

How the calculator works

  1. Profit: your self-employed income minus allowable expenses, or minus the £1,000 trading allowance if that’s more.
  2. Income Tax: worked out on your profit plus any salary, using the personal allowance (reduced above £100,000) and the bands for where you live. If you also have a job, only the extra tax your business adds is shown, because tax on your salary is taken through PAYE.
  3. Class 4 National Insurance: 6% of profits between £12,570 and £50,270, and 2% above. If you also have a job, the Class 1 National Insurance on your salary uses up part of the 6% band (all of it once your salary is over about £40,845), so more of your profit pays 2%.
  4. Student loans: 9% of your total income above your plan’s threshold (6% for a postgraduate loan), less what PAYE already took from your salary.
  5. When to pay: the balancing payment and any payments on account, with their dates.

Choosing the tax year

Pick 2025/26 if you’re filing your tax return by 31 January 2027: it covers 6 April 2025 to 5 April 2026. Pick 2026/27 to plan for the tax year you’re in now. The bands are the same except in Scotland, where the lower bands were raised for 2026/27, and student loan thresholds rise each year.

Payments on account

Payments on account catch many people out in their first year. If your bill is £3,000, you pay that £3,000 on 31 January plus a first payment on account of £1,500 towards next year, then another £1,500 on 31 July. If you expect lower profits next year, you can ask HMRC to reduce your payments on account.

Making Tax Digital

From 6 April 2026, sole traders and landlords whose income (before expenses) was over £50,000 must keep digital records and send HMRC quarterly updates. The threshold falls to £30,000 from April 2027 and £20,000 from April 2028.

What this calculator doesn’t include

Partnerships, dividends, savings interest, property income, pension contributions, losses carried forward and Gift Aid. Business expenses must be “wholly and exclusively” for the business to be allowable.

Last updated

Frequently asked questions

How much tax do I pay as a sole trader?

Income Tax on your profit above the £12,570 personal allowance (20%, 40% and 45% in England, Wales and Northern Ireland; Scotland has its own bands), plus Class 4 National Insurance of 6% on profits between £12,570 and £50,270 and 2% above. On £40,000 of profit in England that's £5,486 Income Tax and £1,645.80 National Insurance for 2025/26.

Do I still pay Class 2 National Insurance?

No. Since 6 April 2024, self-employed people no longer pay Class 2. If your profits are above the small profits threshold (£6,845 in 2025/26, £7,105 in 2026/27), you get National Insurance credits towards your State Pension automatically. Below that, you can choose to pay voluntarily (£3.50 a week in 2025/26).

What are payments on account?

Advance payments towards next year's tax bill. If your last bill was £1,000 or more and less than 80% of your tax was taken through PAYE, HMRC asks for two payments on account, each half of last year's Income Tax and Class 4 National Insurance, due on 31 January and 31 July. In your first year this means 31 January includes both the whole bill and the first advance payment.

When is the self-assessment deadline for 2025/26?

Register by 5 October 2026 if you're new to self-assessment. File a paper return by 31 October 2026, or online by 31 January 2027, which is also when the tax is due. Filing late costs an initial £100 penalty, even if you owe no tax.

What is the £1,000 trading allowance?

If your self-employed income is £1,000 or less in a tax year, it's tax-free and you usually don't need to tell HMRC. If it's more, you can deduct £1,000 instead of your actual expenses. The calculator uses whichever gives you the lower profit. Budget 2026 raises the allowance to £3,000 from April 2027.