Self-Employed Tax Calculator (2025/26)
How it works
Self-employed people pay Income Tax on profit (turnover minus allowable expenses), then Class 4 NI on top. The £1,000 trading allowance can replace expenses if they're tiny. Once your tax bill tops £1,000, HMRC asks for "payments on account" — half your expected next-year bill in January and July.
Worked example
Freelancer: £60,000 turnover, £12,000 expenses → £48,000 profit.
- Tax: £7,086 (basic rate on £35,430)
- Class 4 NI: £2,124 (6% × £35,430)
- Total: £9,210 + £4,605 January payment on account
Who should use this
- •Sole traders and freelancers
- •Side hustlers earning over £1,000
- •Landlords with rental income
- •Anyone considering going self-employed
Common mistakes
- ×Forgetting payments on account double the first January bill
- ×Missing the trading allowance (£1,000)
- ×Not claiming home office, mileage, professional fees
- ×Leaving registration too late (5 Oct deadline)
Frequently asked questions
When is my Self Assessment due?▾
Online return + payment by 31 January after the tax year. Paper returns by 31 October.
What expenses can I claim?▾
Anything 'wholly and exclusively' for business — office costs, travel (not commute), phone, professional subscriptions, insurance, marketing.
Do I need an accountant?▾
Not legally required, but most freelancers earning over £30k find one saves more than they cost. FreeAgent, Xero, QuickBooks are popular DIY tools.
When should I register for VAT?▾
Mandatory once 12-month turnover passes £90,000. Voluntary registration can help if your customers are VAT-registered.
Should I incorporate?▾
Often makes sense above £40–50k profit, depending on dividend strategy. Use our Sole Trader vs Ltd calculator.
What is Making Tax Digital?▾
From April 2026, sole traders/landlords with income over £50k must keep digital records and submit quarterly updates via MTD-compatible software.