Self Assessment Tax Calculator 2025/26

Understanding Self Assessment Tax

If you are self-employed, a sole trader, or a freelancer in the UK, you are responsible for calculating and paying your own tax through HMRC's Self Assessment system. This includes income tax on your profits, Class 2 National Insurance (a flat weekly rate), and Class 4 National Insurance (a percentage of your profits).

Our calculator estimates your total tax bill for the 2025/26 tax year based on your turnover, expenses, and any other income. It includes the payment on account you will need to make towards next year's bill.

How Self-Employed Tax Is Calculated

1. Calculate your profit: Turnover minus allowable expenses = taxable profit
2. Add other income: If you have employment income, rental income, etc., add it to your self-employment profit
3. Deduct personal allowance: £12,570 (unless tapered due to income above £100,000)
4. Calculate income tax: Apply 2025/26 tax bands to your taxable income
5. Calculate Class 4 NI: 6% on profits between £12,570 and £50,270; 2% on profits above £50,270
6. Add Class 2 NI: £3.45/week (£179.40/year) if profits above £12,570

Key Deadlines

Payment on Account

If your tax bill is £1,000 or more and less than 80% was collected at source (e.g., through PAYE), you must make payments on account. These are advance payments towards next year's tax, each equal to 50% of the current year's bill:

• First payment: 31 January (at the same time as the previous year's balance)
• Second payment: 31 July
• Balancing payment: The following 31 January (any difference between payments on account and actual tax owed)

Allowable Expenses

You can deduct "wholly and exclusively" business expenses from your turnover before calculating tax. Common allowable expenses include:

• Office costs: Stationery, phone and internet (business proportion), postage, software subscriptions
• Travel: Business mileage (45p/mile for first 10,000 miles, 25p/mile thereafter), public transport, parking
• Premises: Rent, business rates, utilities (business proportion), insurance
• Working from home: Use simplified expenses (£6/week flat rate) or calculate actual proportion of household costs
• Staff costs: Wages, employer NI, subcontractor costs
• Marketing: Advertising, website costs, business cards
• Professional fees: Accountant, solicitor, professional subscriptions
• Financial costs: Bank charges, loan interest (business), credit card fees
• Training: Courses to update existing skills (but not to acquire new ones)

Penalties for Late Filing and Payment

Tips for Managing Self-Assessment

1. Set aside 25-30% of all income in a separate savings account for tax. This is the simplest way to avoid a shock bill in January.
2. Keep records of all income and expenses throughout the year. Digital records are now required under Making Tax Digital.
3. Use accounting software: FreeAgent, Xero, or QuickBooks make invoicing, expense tracking, and tax estimation much easier.
4. Claim all allowable expenses: Many self-employed people underclaim, paying more tax than necessary.
5. File early: You can file your return any time after 6 April. Filing early tells you what you owe sooner and reduces stress.
6. Consider an accountant: A good accountant typically saves more than they cost through proper tax planning and expense advice.