Contractor take-home pay calculator UK — how it works
This calculator estimates your salary after tax for the UK 2026/27 tax year. It applies the standard £12,570 personal allowance, taxes income above that at the 20% basic rate up to £50,270, then 40% to £125,140, and 45% above. Class 4 National Insurance is calculated at 6% on profits between £12,570 and £50,270, and 2% above. Personal allowance taper kicks in once profits exceed £100,000.
What counts as a business expense?
Allowable expenses for UK freelancers typically include software subscriptions, professional indemnity insurance, business travel, a fair share of home-office costs, accountancy fees, and equipment. Subtracting these from your gross income gives your taxable profit. Always keep receipts: HMRC can audit Self Assessment returns up to four years later.
Salary after tax UK freelancer — sole trader vs limited company
This calculator models the sole trader / self-employed route, which is the most common starting point. Limited company take-home pay works differently because you typically take a low salary plus dividends, with corporation tax on company profit. The right structure depends on your income level, IR35 status and admin appetite — see our umbrella vs limited guide.
IR35 calculator UK — does this apply to me?
If you contract through your own limited company and your engagement falls inside IR35, your take-home will be closer to a PAYE employee's, because the deemed payment is taxed as employment income. Outside IR35, you keep more flexibility around dividends. Read our IR35 explainer.
Tips to keep more of what you earn
- Track every allowable expense — even small monthly tools add up.
- Pay into a pension: contributions are tax-deductible and reduce your liability.
- Set aside ~25–30% of every invoice in a separate tax pot.
- Use Making Tax Digital (MTD) software to avoid late-filing penalties.
- Review your structure annually as profits grow — what works at £30k often doesn't at £80k.
Estimates only — figures use HMRC's published 2026/27 thresholds and are not personalised tax advice. Speak to a qualified accountant for your specific situation.