Do I still have to pay Class 2 National Insurance?

Not as a compulsory charge. Since April 2024 Class 2 is no longer mandatory. Above the Small Profits Threshold (£7,105) you get a qualifying year for free; below it you can pay Class 2 voluntarily (£3.65 a week) to protect your State Pension record.

How is the calculation different in Scotland?

Only Income Tax changes. Scotland has six bands (19% to 48%) set by the Scottish Parliament. The Personal Allowance and all National Insurance (Class 2 and Class 4) are exactly the same as the rest of the UK.

Self-Employed Tax Calculator

Q: Am I taxed on my turnover or my profit?

You are taxed on your profit: income minus allowable business expenses. Income Tax and Class 4 National Insurance are both worked out on that profit, after deducting your Personal Allowance. VAT is separate.

Q: Is this calculator official?

No, it gives a guidance figure and is not a substitute for advice from HMRC or an accountant. It assumes a sole trader who is single, with no children and no other income, and excludes Student Loan repayments, pension contributions and payments on account.

Work out what you keep as a sole trader. Enter your annual profit and see your Income Tax, Class 4 and Class 2 National Insurance, and your take-home pay for the 2026/27 tax year.

Income Tax by band Class 4 & Class 2 NIC Live result

Your details

Annual profit before tax (profit = income − allowable expenses)

£ / year

Enter your taxable profit (not your turnover). You can type decimals with a point.

Where you pay Income Tax

Scotland sets its own Income Tax bands (19%–48%). National Insurance is the same across the whole UK.

Voluntary Class 2 NIC

Pay voluntary Class 2 to protect my State Pension record

Only relevant if your profit is below the Small Profits Threshold (£7,105). Above it, you build a qualifying year for free.

Take-home pay per year

—

— £ / month

Profit (gross)—

Personal Allowance—

Taxable income—

Income Tax—

Class 4 NIC—

Class 2 NIC—

Total tax & NIC—

Take-home pay per year—

Effective tax & NIC rate—

Income Tax and Class 4 NIC are worked out band by band for the 2026/27 tax year. This assumes a sole trader with no other income.

Guidance only, not an official calculation. Rates and thresholds as at 6 April 2026 (tax year 2026/27). This is not a substitute for advice from HMRC or an accountant: it assumes a sole trader, single with no children, with no other income (the same assumptions as HMRC's ready reckoner). It does not include Student Loan repayments, pension contributions, payments on account, the High Income Child Benefit Charge or Marriage Allowance.

How your self-employed tax is worked out

From profit, through Income Tax and National Insurance, to your take-home pay — step by step

1. Profit, not turnover

What you are taxed on

As a sole trader you are taxed on your profit (income minus allowable business expenses), not on your turnover. That profit is the figure that feeds both your Income Tax and your National Insurance. The tax year runs from 6 April to 5 April.

2. Income Tax by band

Personal Allowance + rates

The first £12,570 (Personal Allowance) is tax-free, then 20% (basic), 40% (higher) and 45% (additional) apply across the bands. Above £100,000 the Personal Allowance is tapered away by £1 for every £2 of profit, disappearing at £125,140. Scotland uses its own six bands from 19% to 48%.

3. National Insurance

Class 4 & Class 2

Class 4 is charged at 6% on profit between £12,570 and £50,270, then 2% above that. Class 2 is no longer compulsory: if your profit is above the Small Profits Threshold (£7,105) you build a qualifying year for the State Pension for free; below it, you can pay it voluntarily.

4. Take-home pay

What is left

Your take-home pay is your profit minus Income Tax and National Insurance. The calculator shows each part separately and the effective rate, so you can see exactly where your money goes — useful for setting money aside before your Self Assessment bill.

Frequently asked questions about self-employed tax

The key points on Income Tax and National Insurance for sole traders

You are taxed on your profit: your income minus allowable business expenses. Income Tax and Class 4 National Insurance are both worked out on that profit, after deducting your Personal Allowance. VAT is separate and only applies once you cross the registration threshold.

No, not as a compulsory charge. Since April 2024 Class 2 is no longer mandatory. If your profit is above the Small Profits Threshold (£7,105) you get a qualifying year towards your State Pension without paying anything. If your profit is below it, you can choose to pay Class 2 voluntarily (£3.65 a week) to protect your record — tick the box above to include it.

Only the Income Tax changes. Scotland has six bands — starter 19%, basic 20%, intermediate 21%, higher 42%, advanced 45% and top 48% — set by the Scottish Parliament. The Personal Allowance (£12,570) and all National Insurance (Class 2 and Class 4) are exactly the same as the rest of the UK. Switch the region toggle to see the difference.

No. It gives a guidance figure for the 2026/27 tax year and is not a substitute for advice from HMRC or an accountant. It assumes a sole trader who is single, with no children and no other income, and excludes Student Loan repayments, pension contributions, payments on account and the High Income Child Benefit Charge. For your binding figure, use HMRC's Self Assessment or your accountant.