UK Self Assessment Tax Calculator 2024-25

What taxes does a self-employed person pay in the UK?

A self-employed person in the UK typically pays three types of tax: income tax on profits above the personal allowance (20% basic rate, 40% higher rate, 45% additional rate); Class 2 National Insurance (£3.45/week, a flat annual charge of £179.40 if profits exceed £12,570); and Class 4 National Insurance (6% on profits between £12,570 and £50,270, then 2% above). All these are reported and paid through the annual Self Assessment tax return. The deadline is 31 January online (or 31 October for paper returns). Payment is also due on 31 January for the prior year's balance plus the first payment on account towards the current year.

What expenses can I deduct as a self-employed person?

Self-employed people can deduct expenses that are "wholly and exclusively" incurred for business purposes. Common allowable expenses include: office costs (stationery, phone, broadband); travel costs (fuel, public transport, parking — but not ordinary commuting); clothing (uniforms or protective equipment, not regular clothes); staff costs if you employ people; stock or raw materials; financial and legal costs (accountant fees, bank charges); advertising and marketing; training courses directly related to your current business; and a proportion of home costs if you work from home (calculated by hours or rooms used). You cannot deduct personal expenses, client entertaining, or costs with a dual personal and business purpose. Capital items (equipment, vehicles) are handled through capital allowances, not direct expenses, though small items can often be written off in full via the Annual Investment Allowance.

What are payments on account and how do they work?

Payments on account are advance payments towards your next year's Self Assessment tax bill. They are required when your tax bill exceeds £1,000. Each payment on account is 50% of the previous year's income tax plus Class 4 NI (Class 2 NI and any capital gains tax are excluded). So if your 2024/25 tax bill is £10,000, you make two payments on account of £5,000 each — one on 31 January 2026 and one on 31 July 2026 — both as advance payments towards your 2025/26 bill. If your actual 2025/26 bill is higher, you pay the "balancing payment" on 31 January 2027. If it is lower, you get a refund. You can apply to reduce your payments on account if you expect your income to be lower in the next year — but beware: if you reduce them too far, HMRC charges interest on the difference.

When do I need to file a Self Assessment return?

You must register for Self Assessment and file a return if you are self-employed with profits above £1,000 (the trading allowance) in the tax year. You must also file if your total income was over £100,000, you had income from abroad, you received untaxed income above £2,500 (such as rent), you have capital gains above the annual exempt amount (£3,000 in 2024/25), or you receive Child Benefit and you or your partner earned over £60,000. You must register for Self Assessment by 5 October following the end of the tax year in which you became self-employed. For example, if you started working for yourself in June 2024 (tax year 2024/25), you must register by 5 October 2025. The filing deadline for online returns is 31 January following the tax year end (so 31 January 2026 for 2024/25), with payment due on the same date.