Self-Employed Tax Calculator
Enter your expected profit for the year and see your 2026/27 income tax, Class 4 National Insurance, total bill, effective rate and what is left each month — the numbers behind your Self Assessment.
Last updated 2 July 2026 · Written and reviewed by Mustafa Bilgic
Self-employed tax calculator
Sole-trader income tax + Class 4 NI, 2026/27.
Estimate only — figures use the latest published UK rates. Always confirm on GOV.UK.
How sole-trader tax works
As a sole trader you are taxed on your profit — your business income minus allowable expenses — not on everything you invoice. For 2026/27 you get the standard £12,570 personal allowance, then pay income tax at 20% in the basic-rate band, 40% in the higher band and 45% above £125,140. On top of income tax you pay Class 4 National Insurance: 6% on profits between £12,570 and £50,270 and 2% above that. Everything is settled once a year through Self Assessment rather than PAYE — which is why the January bill catches so many people by surprise. Employees can compare the equivalent payslip deductions with our take-home pay calculator.
On a profit of £38,000, taxable profit after the £12,570 allowance is £25,430. Income tax at 20% is £5,086 and Class 4 NI is £1,525.80 — a total bill of £6,611.80, leaving take-home of £31,388.20 (about £2,615.68 a month, an effective rate of 17.4%).
2026/27 bands for the self-employed
| Band | Profits | Income tax | Class 4 NI |
|---|---|---|---|
| Personal allowance | Up to £12,570 | 0% | 0% |
| Basic rate | £12,571 – £50,270 | 20% | 6% |
| Higher rate | £50,271 – £125,140 | 40% | 2% |
| Additional rate | Over £125,140 | 45% | 2% |
One trap for strong years: once income passes £100,000 the personal allowance is withdrawn at £1 for every £2 of income above it, disappearing entirely by £125,140. The calculator applies this taper automatically. The bands themselves are the same as for employees — see our income tax rates guide — it is the National Insurance treatment that differs, as explained in our National Insurance calculator.
Self Assessment and payments on account
Your return and payment for the tax year are due online by 31 January following the end of the year. If your bill is over £1,000, HMRC usually also requires payments on account: two advance instalments towards the next year's bill, each half of the current bill, due on 31 January and 31 July. In practice that means your first January as a sole trader can cost one-and-a-half times the bill you were expecting — worth planning for from the first invoice. The rules are set out on GOV.UK.
Class 2, the trading allowance and expenses
Class 2 NI is no longer compulsory. If your profits are under £6,845 you can pay it voluntarily at £3.65 a week for 2026/27 to protect your State Pension record; at £6,845 or more your record is protected anyway. The trading allowance makes your first £1,000 of gross trading income tax-free — useful for side hustles — and above that level you can deduct either the flat £1,000 or your actual expenses, whichever is higher.
Allowable expenses are the everyday costs of running the business: office costs and equipment, business travel (see our mileage claim calculator), stock and materials, business insurance, professional fees and a reasonable share of home-working costs. If you are VAT-registered, remember the figures here are exclusive of VAT — our VAT calculator handles that side. GOV.UK publishes the full list of allowable expenses.
Frequently asked questions
How much tax do I pay on self-employed profits?
You pay income tax at 20%, 40% and 45% on profits above your £12,570 personal allowance, plus Class 4 National Insurance at 6% on profits between £12,570 and £50,270 and 2% above that. On £38,000 of profit the combined bill is £6,611.80 for 2026/27 — about 17.4% of profit.
When do I pay my Self Assessment tax bill?
The online filing and payment deadline is 31 January after the end of the tax year. If your bill is over £1,000, HMRC usually also asks for payments on account — two advance instalments towards the next year's bill, each half of this year's bill, due on 31 January and 31 July.
Do I still need to pay Class 2 National Insurance?
Class 2 is no longer compulsory. If your profits are under £6,845 you can choose to pay it voluntarily at £3.65 a week for 2026/27 to protect your State Pension record. With profits of £6,845 or more, your record is protected without paying Class 2.
What is the trading allowance?
The trading allowance makes your first £1,000 of gross trading income each tax year tax-free. If your self-employed income is under £1,000 you usually do not need to report it at all. Above that, you can choose to deduct the flat £1,000 instead of your actual expenses — whichever is better for you.
What expenses can I claim as a sole trader?
Allowable expenses reduce your taxable profit. Typical claims include office costs and equipment, business travel and mileage, stock and materials, business insurance, professional fees and a reasonable share of home-working costs. This calculator expects your profit after expenses, so deduct them first.