UK Freelance Tax Calculator 2025/26

As a general rule, UK freelancers should set aside 25-35% of their gross income for taxes. This covers Income Tax and Class 4 National Insurance contributions.

Your exact amount depends on your profit level. Basic rate taxpayers (£12,571-£50,270) typically need 25-28%, while higher rate taxpayers (£50,271-£125,140) should set aside 30-35%. Additional rate taxpayers (over £125,140) may need 40-45%. Use our calculator above for a personalized estimate.

Class 4 National Insurance (NI) is the UK equivalent of social security contributions for self-employed individuals. For 2025/26, the rates are:

• 6% on profits between £12,570 and £50,270
• 2% on profits above £50,270

Unlike employees who pay Class 1 NI (split with employers), self-employed people pay Class 4 NI on their annual profits through Self Assessment. You may also need to pay Class 2 NI (£3.45/week) if your profits exceed £12,570.

The key UK tax deadlines for 2025/26 are:

• 31 January 2026: Deadline to file 2024/25 tax return online + pay any tax owed for 2024/25 + first payment on account for 2025/26
• 31 July 2026: Second payment on account for 2025/26
• 31 January 2027: Final balancing payment for 2025/26 tax year

Payments on account are advance payments towards your next tax bill, each worth 50% of your previous year's tax liability. Missing deadlines results in penalties and interest from HMRC.

UK freelancers can claim allowable business expenses that are "wholly and exclusively" for business purposes, including:

• Office costs (rent, utilities, home office use)
• Travel expenses (business mileage, public transport, accommodation)
• Professional fees (accountant, legal, professional memberships)
• Marketing and advertising costs
• Business insurance and pension contributions
• Equipment, software, and technology
• Training and professional development
• Phone and internet (business portion)

Keep all receipts and records for at least 5 years. HMRC may request evidence during an enquiry.

You must register for VAT if your taxable turnover exceeds £90,000 in any 12-month period (2025/26 threshold). You must register within 30 days of exceeding this threshold.

You can also voluntarily register for VAT even if you're below the threshold. Benefits include reclaiming VAT on business purchases, but you'll need to charge VAT (20% standard rate) on your invoices and submit quarterly VAT returns to HMRC.

Once registered, you'll charge VAT on most goods and services, file returns every 3 months, and use Making Tax Digital (MTD) compatible software from April 2026.