UK Self-Employed Tax Calculator 2026/27
Estimate income tax and Class 4 National Insurance on sole-trader profits for 2026/27, your take-home, and the January and July payments on account.
| Taxable profit | — |
|---|---|
| Personal allowance | — |
| Income tax | — |
| Class 4 National Insurance | — |
| Class 2 National Insurance | — |
| Effective rate on profit | — |
| Take-home from the business | — |
| Monthly take-home | — |
| Balancing payment due 31 January | — |
| Payments on account for next year (31 Jan + 31 Jul) | — |
In short
A UK sole trader in 2026/27 pays income tax on profits above the £12,570 personal allowance (20% to £50,270, 40% to £125,140, 45% above) plus Class 4 National Insurance of 6% on profits between £12,570 and £50,270 and 2% above; Class 2 is treated as paid once profits reach £7,105. Bills over £1,000 trigger two payments on account of 50% each for the following year.
Who this is for: UK sole traders and freelancers estimating their Self Assessment bill, take-home and payments on account.
What a sole trader pays in 2026/27
- Income tax on profit (turnover − allowable expenses, or − the £1,000 trading allowance if that is higher) added to any other income: 0% on the first £12,570, 20% to £50,270, 40% to £125,140, 45% above. The personal allowance tapers away above £100,000.
- Class 4 National Insurance: 6% on profits between £12,570 and £50,270, 2% above.
- Class 2 National Insurance: no longer compulsory. Profits of £7,105 or more earn the State Pension credit automatically; below that you can pay £3.65 a week voluntarily to keep your record.
- Payments on account: once your bill exceeds £1,000 (and less than 80% of your tax was collected at source), you pay 50% of this year's bill towards next year on 31 January and 31 July, then a balancing payment the following January.
Pension contributions extend your basic-rate band (and reduce the income used for the allowance taper), which is why they are asked for separately. Scottish income tax bands differ; this calculator uses the England/Wales/NI bands with UK-wide NI.
Assumptions
- Profit = turnover − max(expenses, £1,000 trading allowance).
- Income tax on profit + other income with the 2026/27 bands, pension contributions extending the bands and tapering the allowance; tax on other income is shown separately as PAYE.
- Class 4 NI 6%/2% on profit; Class 2 shown as voluntary £3.65/week below £7,105; payments on account = 50% of the bill each when over £1,000.
Worked example
Profit = £48,000. Income tax: (48,000 − 12,570) × 20% = £7,086. Class 4 NI: (48,000 − 12,570) × 6% = £2,126. Class 2: treated as paid.
Total £9,212 (19.2% of profit); take-home £38,788, about £3,232 a month.
Payments on account for next year: 2 × £4,606. In a first trading year, the 31 January payment would be £9,212 + £4,606 = £13,818.
Frequently asked questions
Should I become a limited company instead?
At £48,000 profit a company paying a small salary plus dividends saves a few thousand a year in NI, but adds accountancy and admin costs and dividend rates rose in April 2026. Many sole traders find the break-even around £40,000–£50,000 of profit — model both before switching.
Is the trading allowance instead of expenses?
Yes — you claim either £1,000 or your actual expenses, never both. With turnover under £1,000 you need not register at all.
Do I pay NI on rental or investment income?
No. Class 4 applies only to trading profits; rental income is taxed through income tax alone.
When do I need to file?
Register for Self Assessment by 5 October after the tax year you started trading; file online and pay by 31 January. Making Tax Digital quarterly updates apply from April 2026 for turnover over £50,000 and April 2027 over £30,000.
How much tax do I pay on £50,000 self-employed?
About £7,486 income tax and £2,246 Class 4 NI — roughly £9,730, or 19.5% of profit, with no other income.
Do I still pay Class 2 National Insurance?
Not compulsorily — profits of £7,105 or more earn the credit automatically; below that you can pay £3.65 a week voluntarily.
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