Self-employed tax · 2026/27

How much should I set aside for tax as a UK freelancer?

6 minute read · 2026/27 rates · Updated November 2026

The short answer: put aside 20–30% of every payment you receive. The longer answer depends on your profit, and on whether you have a salaried job too.

What you pay tax on

You pay tax on your profit, which is your income minus allowable business expenses. If your expenses are small, you can claim the £1,000 trading allowance instead of your actual costs.

On that profit you pay two things:

Income Tax: nothing on the first £12,570 (your Personal Allowance), then 20% up to £50,270 and 40% above that.
Class 4 National Insurance: 6% on profit between £12,570 and £50,270, then 2% above.

A worked example

Say you're a full-time freelancer with no other job, and your profit for the year is £30,000.

£30,000 profit, 2026/27
Profit above the Personal Allowance	£17,430
Income Tax at 20%	£3,486.00
Class 4 NI at 6%	£1,045.80
Total bill	£4,531.80
As a share of profit	15.1%

So why save 20–30% rather than 15%? Because of payments on account.

The payments on account trap

If your bill is over £1,000, HMRC usually asks you to pay towards next year's bill as well. Each payment on account is half of this year's bill, due on 31 January and 31 July.

In your first big year, that means paying the full bill plus 50% extra on 31 January. In the example above, that's £4,531.80 + £2,265.90 = £6,797.70 due in one go. Saving 20–30% as you go is what covers it.

If you also have a job

Your salary usually uses up your Personal Allowance, so every pound of freelance profit is taxed from the first pound. If your salary already takes you into the 40% band, set aside closer to 45%.

Dates to know

5 October: register for Self Assessment if this is your first year (for profit over £1,000).
31 January: online return and balancing payment due, plus the first payment on account.
31 July: second payment on account.
Making Tax Digital: quarterly updates apply from April 2026 if your self-employed and property income is over £50,000, from April 2027 over £30,000, and from April 2028 over £20,000.

Our UK Freelancer Income & Tax Tracker works all of this out as you log your income, including your set-aside % and payments on account.

See the tracker

Want your own figure? Our free calculator works out your bill and set-aside percentage, including for Scottish taxpayers.

Use the calculator

The rates above are for England, Wales and Northern Ireland. Scotland has its own Income Tax bands, which our calculator and Scotland tracker use. This is general information, not tax advice. Check GOV.UK or an accountant for your own situation.