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How much tax should I put aside?

Tell us what you invoice and what it costs you. We’ll show how much to move into a tax pot each week or month — after any CIS already taken — so January doesn’t catch you out.

Per invoice, week or monthA simple percentage you can use every time you’re paid.
CIS-awareTakes off the tax already deducted under CIS.
First-year warningShows the 1.5× January bill new starters forget.
Example figures — replace with your own. Example figures are filled in so you can see how it works — replace them with your own before relying on the result shown.

1. Your setup

Tax year 2026/27 (6 April 2026 to 5 April 2027).

Scotland has its own Income Tax bands; NI is the same UK-wide.
Pick “No” if customers pay you in full.
First-timers often face a bigger January bill.

2. Money in and costs

Use your typical figures, before any CIS is taken off.

Before CIS and excluding any VAT you charge.
Enter 0 or more.
No CIS is taken on these, and they aren’t profit.
Enter 0 or more.
Van, fuel, tools, insurance, phone…
Enter 0 or more.
Materials are more than what you invoice — check the figures.

3. Check one invoice (optional)

See how much of a single invoice to move into your tax pot.

Leave blank to skip.
Enter 0 or more.

Show the maths

How we got your figure

The tax and NI are worked out on your profit for the 2026/27 tax year, then shared out across the year.

The step-by-step working will appear here.

Guide

How to put money aside for tax when you’re self-employed

Nobody takes tax off your pay when you work for yourself (unless you’re in CIS), so it’s up to you to keep enough back. The simplest way is a separate savings pot that you top up every time a customer pays you.

  1. Work out your profit. Turnover minus materials and allowable costs. Tax is charged on profit, not on what you invoice.
  2. Work out the tax and NI on it. Income Tax at 20% (Scotland: 19% to 21% on the lower bands) above the £12,570 Personal Allowance, plus Class 4 NI at 6% between £12,570 and £50,270.
  3. Take off any CIS. CIS is tax paid in advance, so you only need to save what CIS doesn’t cover.
  4. Turn it into a percentage of each invoice, and move that amount every time you’re paid.

People often use a rule of thumb of 20–30%. That can be too much for lower earners and too little for higher earners, which is why the calculator works it out from your own figures. Our guide to putting tax aside has worked examples at different incomes.

Things people forget

Payments on accountIn your first year you can owe the whole bill plus half again in January. See payments on account.
Profit, not turnoverYou pay tax on what’s left after costs. Keep receipts so you can claim them all.
Class 2 NIIt’s no longer charged, but if your profit is under £7,105 you may want to pay it voluntarily (£3.65 a week) for your State Pension.
Student loanIf you have one, repayments are collected through Self Assessment too and aren’t included here.
Other incomeA PAYE job or rental income uses up some of your allowance and bands, so you may need to save more.
A separate accountMoney left in your everyday account tends to get spent. A separate pot makes January much easier.

Frequently asked questions

How much tax should I put aside when self-employed?

Work out your expected profit for the year, then the Income Tax and Class 4 National Insurance on it, and divide by the number of times you are paid. For many sole traders on modest profits it comes to 10% to 20% of turnover; for higher earners it can be 25% or more. The calculator works it out from your own figures.

Is 30% too much to put aside for tax?

For most sole traders earning under £50,270 profit, 30% of turnover is more than they need, because the first £12,570 of profit is tax-free and costs reduce your profit. Putting aside too much is safer than too little, but you can use the calculator to find a figure that matches your income.

Do I need to put tax aside if I am in CIS?

Usually less, and sometimes nothing. The 20% CIS deduction often covers most or all of a subcontractor’s tax and Class 4 NI, and many get a refund. If you earn more, or have few costs, CIS may not cover it all, and you will need to save the difference.

When is self-employed tax paid?

For the 2026/27 tax year, your return and payment are due by 31 January 2028. If you owe £1,000 or more, you may also pay towards the next year in two payments on account, on 31 January and 31 July.

Why is my first tax bill so big?

In your first year you pay the whole bill for that year plus a first payment on account for the next year, both in the same January. That can be one and a half times the bill. You then pay the second payment on account in July.

Does this include VAT?

No. If you are VAT registered, the VAT you charge belongs to HMRC and you should keep that aside separately. Enter your turnover excluding VAT.

CalculatorPayments on Account CalculatorYour 31 January and 31 July payments, the balancing payment, and whether CIS means you owe none.CalculatorCIS Tax & Refund CalculatorCheck the CIS that should have been taken, spot deductions on materials, and estimate your refund or bill.CalculatorDay Rate CalculatorThe day rate you need for the take-home you want, or what your current rate really leaves you.GuideHow much tax to put asideReal percentages at different profits, with and without CIS, and how to build a tax pot.GuidePayments on account explainedWhy January can be 1.5 times your bill, the £1,000 and 80% rules, and how CIS affects them.GuideSelf Assessment deadlines and penaltiesEvery key date for 2025/26 and 2026/27, and exactly what it costs to file or pay late.

Sources and review

Last reviewed: 21 October 2026. The rates and rules on this page were checked against GOV.UK guidance on that date by the HandySums team. We re-check every April, after each Budget and whenever GOV.UK changes. HandySums is independent and not an accountancy firm — see how we check our sums.

Estimate only — not tax advice. This calculator uses 2026/27 UK rates (England, Wales, Northern Ireland and Scotland) and assumes you are a sole trader with no other income, your costs are allowable, and figures stay the same through the year. It does not include student loan, voluntary Class 2, pension contributions, VAT or capital gains. Your actual bill depends on your full Self Assessment. Verify with HMRC or a qualified accountant. The figures you enter stay in your browser and are not stored.