SoleTraderTaxCalculator
Updated for 2026/27

Profit after tax calculator

For pricing decisions, rate negotiations and scenario planning — see how much of a given profit level you actually keep once income tax and NI are deducted.

Updated for 2026/27. Uses UK tax bands and HMRC/GOV.UK guidance. Estimates only — not tax advice.

Calculate sole trader tax Read the guides
Scenario planningNet profitMonthly viewBudgeting
2026/27 tax year England, Scotland, Wales & NI Student loan support Practical reserve figure

Profit after tax calculator

Net profit for rate negotiation and scenario planning — 2026/27

Adjust inputs below — results update instantly.

Tax year 2026/27
How do you earn?

Enter profit after allowable business expenses — not total turnover.

The annual profit used in calculations will be monthly profit × 12.

£
£
Expenses exceed estimated turnover — check your inputs.
£
£
Expenses exceed estimated turnover — check your inputs.
£
£
£36,568take-home / year£3,047/mo
Monthly net
£3,047
Tax set-aside
£703
Quarterly reserve
£2,108
Take-home£36,568
Income Tax£6,486
National Insurance£1,946
Student loan£0
Pension£0
Show detailed breakdown ▼
Income tax£6,486.00
Class 4 National Insurance£1,945.80
Student loan£0.00
Pension contribution£0.00
Take-home after tax£36,568.20
Monthly tax set-aside£702.65
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HMRC 2026/27 · Methodology
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Payments on account

Your Self Assessment payment timeline

Based on your estimated bill of £0 for 2026/27, here is when HMRC expects payment — and why your first January bill can feel much bigger than the tax itself. Estimate only — your exact HMRC figures may differ.

31 January
£0
Balancing payment £0 + first payment on account £0
31 July
£0
Second payment on account
Following 31 January
£0
Next balancing payment + first payment on account for the following year
Tax year
ends 5 Apr 31 Jan 31 Jul Next
31 Jan
Set aside each month (ongoing)
£0
Set aside in your first payment-on-account year
£0
Why your first Self Assessment payment can feel higher
The first time you owe £1,000 or more, your 31 January bill includes two things: the full tax bill for the year just finished (the "balancing payment"), plus your first payment on account towards the next year — normally half of this year's income tax and Class 4 NI. That combination is why the first January can feel like roughly 150% of the tax itself.
What payments on account are
Payments on account are advance payments towards your next Self Assessment bill. There are usually two — one due 31 January and one due 31 July — and each is normally half of your previous year's income tax and Class 4 National Insurance. (Class 2 NI, student loan repayments and Capital Gains Tax are not included in payments on account; they are paid in the balancing payment.)
When you might not need to make them
You normally do not make payments on account if your last Self Assessment bill (income tax and Class 4 NI) was under £1,000, or if more than 80% of the tax you owe was already collected at source (for example through PAYE). You may also be able to ask HMRC to reduce your payments on account if you expect your next bill to be lower — but reducing them too far can lead to interest, so check your figures carefully.
Why your exact HMRC bill may differ
This is an estimate based on the figures you entered. Your real Self Assessment bill depends on your full tax position, allowable expenses, other income, reliefs and any adjustments. Always check your actual figures in your HMRC online account before making a payment. This tool does not give personalised tax advice.
2026/27 edition
Sole Trader Tax Survival Pack

Self Assessment checklist, expense tracker, payments on account calendar and more — all in one practical PDF. Updated for 2026/27.

Instant download No subscription Full refund if not satisfied
Get the pack£3.99 one-off
About this calculator

Modelling profit scenarios and rate negotiations

When evaluating a contract, setting rates or deciding whether to take on more work, the question is rarely 'what is my gross income?' — it is 'what do I actually keep?' This calculator is designed for that kind of scenario modelling.

Try different profit levels using the chips below the profit field. Compare the net result at £40,000 vs £50,000 to understand how additional work translates into actual take-home after progressive tax bands.

Last updated July 2026. Written and reviewed by James Whitfield against current GOV.UK and HMRC guidance. Estimates for planning only — not tax, accounting or financial advice.

Profit scenario modelling — questions

How does increasing profit affect take-home at higher income levels?
Once profit exceeds £50,270, additional income is taxed at 40% income tax plus 2% Class 4 NI — an effective marginal rate of 42%. A £10,000 increase in profit above that threshold adds roughly £5,800 to take-home rather than £10,000.
Is this useful for rate negotiations?
Yes. Before negotiating a rate increase, model the new profit level here. If the extra take-home after tax is worth the rate conversation, proceed. If it barely moves the dial because you are already in the higher rate band, the calculation informs the decision.
How does profit after tax compare between sole trader and limited company?
A limited company can extract income through dividends taxed at lower rates than income tax. Use LimitedCompanyTaxCalculator.co.uk with the same profit assumption to compare the net personal take-home from both structures.
Self-Employed Tax Calculator UK
Estimate income tax, Class 4 National Insurance and take-home pay from self-employed income for 2026/27. Covers freelancers, contractors and sole traders.
Sole Trader Tax Calculator
Estimate sole trader income tax, Class 4 National Insurance and take-home profit for 2026/27.
Self Assessment Calculator UK
Estimate your Self Assessment tax bill from sole trader profit and plan for January and July payment deadlines.
Tax Set-Aside Calculator UK
Calculate how much to set aside each month from sole trader profit to cover income tax and National Insurance for 2026/27.
Take-Home Profit Calculator
Estimate how much of your sole trader profit remains after income tax, NI and optional deductions for 2026/27.
Self-Employed National Insurance Calculator
Estimate Class 4 National Insurance contributions from annual self-employed profit for 2026/27.
Sole trader expenses: a practical guide
How allowable business expenses reduce taxable profit, what counts, what does not, and why using the right profit figure matters for every tax estimate.
Making Tax Digital for sole traders
What Making Tax Digital for Income Tax means in practice, who it affects, income thresholds, digital record requirements and how to prepare.
Payments on account: what sole traders need to know
How payments on account work, when they apply, why they catch people out and how to plan your monthly set-aside to cover them.
Self Assessment deadlines for sole traders
The key filing and payment deadlines sole traders must know, what late filing costs, and how to use your tax estimate to prepare in advance.
AfterTaxSalary.co.uk
Use the PAYE salary tool if you want an employed take-home comparison beside your self-employed result.
EmployerCalculator.co.uk
Useful when a sole trader contract is being weighed against hiring someone through payroll.
UKBenefitsCalculator.co.uk
Use this where self-employed income affects benefits planning or household budgeting.
HomeBuyingCosts.co.uk
Useful once you want to turn stable post-tax profit into a realistic home-buying budget.

Figures reviewed for the 2026/27 tax year (last updated July 2026). Source: GOV.UK.

Making Tax Digital

MTD for Income Tax

From 6 April 2026, Making Tax Digital for Income Tax is mandatory for sole traders and landlords with qualifying income over £50,000. That means keeping digital records and sending HMRC a short update every quarter through recognised software, instead of one Self Assessment at year end. The threshold drops to £30,000 in April 2027 and £20,000 in April 2028, and HMRC reckons around 860,000 people are in the first wave.

HMRC-recognised software includes FreeAgent, Xero, QuickBooks, Sage and Zoho Books. FreeAgent is free for Mettle and NatWest business banking customers. There are no penalties for late quarterly updates during 2026/27.

Getting set up

Business bank accounts

Keeping a separate account for business income and expenses makes Self Assessment and record-keeping considerably easier.

Starling Business
Permanently free, no monthly fee. A fully licensed UK bank - deposits up to £85,000 are FSCS protected. Accepts sole traders and limited companies. 0.7% on Post Office cash deposits.
Open an account →
Tide
Free to open. Built-in invoicing and expense tracking. 20p per outgoing transfer on the free tier. Accepts businesses with no trading history. Funds are safeguarded as e-money, not FSCS protected.
Open an account →
Mettle by NatWest
Free for sole traders and single-director limited companies. Includes FreeAgent bookkeeping at no extra cost - useful for MTD record-keeping. Funds safeguarded as e-money, not FSCS protected. No cash deposits.
Open an account →