How Much Tax Do I Pay as a Sole Trader? UK Tax Rates 2026
Tax Breakdown for Sole Traders
As a sole trader, you pay three types of tax:
- Income Tax: 0-45% depending on profit
- Class 2 National Insurance: £3.45/week (£179.40/year) if profits exceed £12,570
- Class 4 National Insurance: 9% on profits between £12,570-£50,270, then 2%
💡 Quick Tip
Thistle calculates your tax bill in real-time as you earn—know exactly how much to set aside.
Tax Examples by Profit Level
| Annual Profit | Income Tax | NI (Class 2+4) | Total Tax | Take Home |
|---|---|---|---|---|
| £15,000 | £486 | £398 | £884 | £14,116 |
| £30,000 | £3,486 | £1,745 | £5,231 | £24,769 |
| £50,000 | £7,486 | £3,547 | £11,033 | £38,967 |
| £75,000 | £17,486 | £4,047 | £21,533 | £53,467 |
Never Be Surprised by Your Tax Bill
Thistle shows your tax liability in real-time and helps you set aside the right amount monthly.
Start Free Trial →Frequently Asked Questions
How much tax do I pay on £30,000 profit?
On £30,000 profit: £3,486 income tax + £1,566 Class 4 NI + £179 Class 2 NI = £5,231 total (17.4% effective rate).
Do I pay tax on turnover or profit?
You pay tax on profit (turnover minus allowable expenses), not total turnover.
Related Articles
How to Calculate Self-Assessment Tax UK: Complete Guide for 2026
Step-by-step guide to calculating your Self-Assessment tax bill as a UK sole trader or freelancer. Includes tax rates, allowances, and a simple calculator formula.
ExpensesWhat Expenses Can I Claim as Self-Employed? 47 Tax Deductions for UK Sole Traders
Complete list of tax-deductible expenses for UK freelancers and sole traders. Learn what you can claim, how much you can save, and avoid HMRC red flags.
TaxVAT Registration Threshold UK 2026: When Do Sole Traders Need to Register?
Complete guide to the UK VAT registration threshold for 2026. Learn when you must register for VAT, voluntary registration pros and cons, and how to stay compliant with HMRC.