Tax Set-Aside Calculator UK 2026/27
Work out how much to save each month for your Self Assessment tax bill
How much should I save for tax?
As a self-employed person or sole trader in 2026/27, you pay income tax and Class 4 National Insurance on your profits. HMRC collects this through Self Assessment, with your annual bill due on 31 January. Most self-employed people should set aside 25–35% of their profit as a safe guide, though the exact amount depends on your profit level, expenses, and any other income.
What is Payments on Account?
If your Self Assessment bill exceeds £1,000, HMRC requires you to make Payments on Account — advance payments towards your next year’s bill. Each payment is 50% of your previous bill, due 31 January and 31 July. This means your first year’s tax payment could be 150% of your actual bill. This calculator warns you if this applies.
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Frequently asked questions
You pay income tax at 20% on profits between £12,570 and £50,270, and 40% above that. You also pay Class 4 National Insurance at 6% between £12,570 and £50,270, and 2% above that. The first £12,570 of profit is tax-free (Personal Allowance).
Your annual Self Assessment bill is due on 31 January following the end of the tax year. For the 2025/26 tax year, the deadline is 31 January 2027. If you also have Payments on Account, a further payment is due 31 July.
A commonly recommended rule is to set aside 25–35% of your self-employed income. Lower earners closer to the personal allowance may need less; higher earners above £50,270 should set aside more. This calculator gives you a precise figure based on your actual profit.
Class 4 NI is charged at 6% on profits between £12,570 and £50,270, and 2% on profits above £50,270. Class 2 NI stopped being compulsory in April 2024.
Worked example
A freelance designer earns £35,000 and has £5,000 of allowable expenses, giving a taxable profit of £30,000. They have 7 months until the January deadline:
| Taxable profit (£35,000 − £5,000) | £30,000 |
| Personal Allowance | −£12,570 |
| Taxable amount | £17,430 |
| Income tax (20%) | £3,486 |
| Class 4 NI (6% on £17,430) | £1,569 |
| Total Self Assessment bill | £5,055 |
| Monthly set-aside (÷ 7 months) | £722 |
| Weekly set-aside | £167 |
Payments on Account will apply as the bill exceeds £1,000 — the first January payment would be £7,582 (bill + 50% POA).
How the calculation works
This calculator uses the 2026/27 HMRC Self Assessment tax calculation method:
- Net profit: Income minus allowable business expenses
- Personal Allowance: First £12,570 of total income is tax-free
- Income tax: 20% on £12,570–£50,270, 40% above, 45% above £125,140
- Class 4 NI: 6% on profits £12,570–£50,270, 2% above (Class 2 no longer compulsory since April 2024)
- Payments on Account: If bill exceeds £1,000, HMRC requires advance payments of 50% each in January and July
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Results are estimates based on 2026/27 HMRC rates and are intended as a guide only. They do not constitute financial or tax advice. Always verify with HMRC or a qualified accountant for your specific circumstances.