Self employed tax calculator UK 2026/27

When you read the figures from this self-employed tax calculator, remember they describe your liability across the whole 2026/27 tax year, not what leaves your bank account each month. Many sole traders feel a mismatch because invoices arrive unevenly while HMRC still expects a predictable total. Treat the annual number as your planning anchor, then use a weekly set-aside percentage so cash in the business matches the estimate you see here.

The effective rate you pay rises as your profit crosses band thresholds — not because a single pound is taxed twice, but because each extra pound of profit is taxed at the marginal rate that applies at that level. That is why going from £48,000 to £52,000 of profit can feel disproportionately expensive: more of that slice sits in the higher-rate band once you pass £50,270, and Class 4 National Insurance also steps up in its own tiers.

If your result looks higher than a colleague’s on similar turnover, check whether you both mean the same thing by “profit.” This tool assumes the number you enter is after allowable expenses. Underclaiming expenses inflates both tax and NI; overclaiming risks HMRC enquiries. A sensible workflow is to keep a running profit figure in your bookkeeping software, then drop that annual total in here once you are confident your categories match HMRC’s rules.

Personal Allowance taper above £100,000 is easy to overlook. Between £100,000 and £125,140 you effectively pay a very high marginal rate because you lose £1 of allowance for every £2 of income. If your estimate sits in that band, small changes in profit or pension contributions can move the dial sharply — worth discussing with an accountant before you make irreversible decisions.

Class 2 National Insurance has changed for most people: many sole traders now receive credits without paying a separate Class 2 bill, while voluntary Class 2 remains a low-cost way to protect qualifying years if profits are low. Class 4 still scales with profit and is collected through Self Assessment. Your calculator output should be read alongside your State Pension planning, not instead of it.

Finally, use this page as a map, not a verdict. Real life includes pension relief claims, gift aid, capital allowances on equipment, and prior-year losses — none of which this general-purpose calculator can model in full. When the number here is close to your filed return, you have understood your business; when it diverges, that gap is usually where the learning (and the accountant’s value) lives.

When you also have PAYE income, use the optional other-income field so bands reflect your real combined total. HMRC does not run two parallel tax worlds — salary uses up part of the basic rate band and side profits can stack into higher rates. Read the total Income Tax line as what the rules imply before employer PAYE is credited; your Self Assessment often reconciles the difference.

If you are side-hustling alongside a job, check the Personal Allowance taper on total income: moderate employment plus freelance profit can land in the £100,000–£125,140 zone where the allowance disappears quickly. Pair this page with the weekly set-aside tool so January and July chunks match how HMRC collects, not just monthly payslips.