Written by Hammad Rasool MAAT·AAT licensed accountant·Updated November 2026

Enter your figures above and the result appears here.

What the calculator works out

  1. Profit: your income less your allowable business expenses. You are taxed on profit, not on what you were paid.
  2. Income Tax: nothing on the first £12,570, then 20% up to £50,270, 40% up to £125,140 and 45% above that.
  3. Class 4 National Insurance: 6% on profits between £12,570 and £50,270 and 2% above.
  4. Class 2 National Insurance: nothing to pay in 2026/27. If your profits are £7,105 or more it is treated as paid, which protects your State Pension record.
Example

Sam earns £45,000 and has £8,000 of expenses, so the profit is £37,000. Income Tax is 20% of £24,430, which is £4,886. Class 4 National Insurance is 6% of £24,430, which is £1,466. The total is £6,352, or about £529 a month. In the first year, the January payment is £6,352 plus £3,176 on account, so £9,528.

Key point: a simple rule that works for most basic rate sole traders is to move 25% of every payment you receive into a separate savings account the day it arrives.

When the tax is due

Tax for 2026/27 is due by 31 January 2028. If the bill is over £1,000 you usually also make payments on account towards the following year, each one half of the bill, on 31 January and 31 July. The exception is where more than 80% of your tax for the year was already collected at source, for example through PAYE on a job. In that case no payments on account are due.

What is not included

Scottish Income Tax rates, student loan repayments, the High Income Child Benefit Charge and pension contributions. If you drive for work, the mileage calculator shows what you can claim at the new 55p rate, and drivers should use the Uber driver tax calculator.

Common questions

How much tax do I pay if I am self employed?
On profits above £12,570 you pay 20% Income Tax plus 6% Class 4 National Insurance up to £50,270, so 26% in total on that slice. Above £50,270 it is 40% plus 2%.
How much should I set aside for tax?
For most basic rate sole traders, 25% of income after expenses is a safe figure. Higher earners need more. The calculator gives a monthly amount.
Why is my first tax bill so high?
Usually because HMRC asks for payments on account. In January you pay the whole of your first year plus half of the next year in advance, unless more than 80% of your tax was already collected at source.
Do I pay Class 2 National Insurance in 2026/27?
No. If your profits are £7,105 or more it is treated as paid. Below that you can choose to pay £3.65 a week voluntarily.

Checked against GOV.UK on 10 November 2026: Income Tax rates, Self employed National Insurance rates, Payments on account.

About the author

Hammad Rasool MAAT is an AAT licensed accountant based in Bolton. TaxTune Accountants looks after sole traders, landlords, contractors and limited companies in Bolton, Wigan, Bury, Salford, Oldham, Stockport and Manchester, and online across the UK.