Income & Freelance Tax Calculator
Work out the hourly and day rate you need to charge to take home a specific amount, after tax, contributions, business expenses and the hours you cannot bill. Most rate calculators run forwards from a rate you guess; this one runs backwards from the income you actually need, which is the direction the question is usually asked in.
- Price:
- Free, no sign-up
- Data:
- Processed locally
- Reviewed:
Interactive income tax calculator
Freelance Target & Costs
Input DataCalculate tax and take-home for freelance earnings
Working Schedule & Capacity
1,121 billable hours a year (604 unbilled for sales & admin).
Tax Profile & Other Incomes
Parameters & SettingsSelf-employed income tax with £12,570 Personal Allowance, Class 4 NI (6% between £12,570–£50,270; 2% above), savings & dividend allowances, and 10%/20% CGT.
Where the Money Goes
Results & OutputComplete distribution of gross income across expenses, taxes, allowances, and take-home pay
Summary of Taxes Payable to HMRC
Results & OutputComplete itemized statement of all Income Tax and National Insurance liabilities owed to HM Revenue & Customs, including calculation basis and payment collection methods
| Tax / Duty | Taxable Basis & Reliefs | Statutory Rates | Collection Channel | Annual Due | Monthly Equiv. |
|---|---|---|---|---|---|
Income Tax (Earned Income) Self Assessment | Taxable income of £45,514 (after £12,570 PA) | 20% / 40% / 45% | Paid via HMRC Self Assessment (31 Jan & 31 Jul) | £10,666 | £889 |
Class 4 Self-Employed National Insurance Self Assessment | £58,084 trading profit (above £12,570 limit) | 6% (£12,570–£50,270) / 2% (>£50,270) | Paid via HMRC Self Assessment (31 Jan & 31 Jul) | £2,418 | £202 |
Total Taxes & National Insurance Payable to HMRC | £13,084 | £1,090 / mo | |||
- 31 January: Deadline to file online return & pay balancing tax (£13,084). Plus 1st Payment on Account of £6,542 (50% advance for next tax year).
- 31 July: 2nd Payment on Account of £6,542 (second 50% advance).
What hourly rate do I need to charge as a freelancer?
Take the take-home pay you need, gross it up for tax and contributions, add your annual business expenses, then divide by billable hours rather than total hours worked. At a 65% billable ratio over a 46-week year, the rate that results is typically 1.7 to 2 times the equivalent salaried hourly figure.
How to use the income tax calculator
- Set your target or gross income: Enter your desired net take-home pay to solve backwards, or switch to Gross Income mode to calculate tax forward.
- Choose employment type: Select Freelancer, Salaried Employee, Combined (Salary + Freelance), or Company Director.
- Toggle Adv Mode for extra streams: Add bank interest (with PSA), stock dividends (with allowance), capital gains (with exemption), or rental profits.
- Read your rates & tax summary: Review net pay, effective and marginal tax rates, required hourly/day rates, and copy the full tax breakdown.
How the income tax calculator works
Working backwards from take-home pay
Most rate calculators go forwards — rate in, income out — which is the wrong direction. You know what you need to live on; the question is what to charge. That inverts to:
billable hours = weeks × hours per week × billable ratio
required profit = gross-up(target take-home)
rate = (required profit + expenses) / billable hours
The gross-up step
Progressive tax cannot be inverted with a single division, because the marginal rate depends on the answer. The tool solves it numerically with a bisection search: it guesses a profit, computes the tax that profit would attract, compares the resulting take-home with your target, and narrows the interval until the two agree to within a penny. Fifty iterations converge well past the precision anyone needs.
What counts as an expense
Anything wholly for the business: software subscriptions, hardware amortised over its life, professional insurance, accountancy, co-working space, travel to clients. These reduce taxable profit, so £1,000 of genuine expense costs you considerably less than £1,000 of take-home pay.
Don't forget the buffer
The output assumes every billable hour is sold. In practice, add a contingency for gaps between contracts — many freelancers plan on 10 or 11 paid months rather than 12, which you can model directly by reducing the working weeks.
Income Tax Calculator — frequently asked questions
Three multipliers stack up. Only part of your week is billable — admin, sales and invoicing are not. You pay your own tax and contributions rather than having an employer split them. And you fund your own holiday, sick leave, equipment and pension. A 60% billable ratio alone means your rate must be roughly 1.7x the naive hourly figure.
Adv Mode models secondary non-work income: savings interest (with the UK Personal Savings Allowance), corporate dividends (with the £500 dividend allowance and tiered rates), capital gains on stocks or crypto (with the £3,000 exemption), rental income, and pre-tax pension relief.
They are a high-fidelity planning estimate adhering to current statutory brackets. The tool applies progressive bands to your profit and income streams, but cannot know individual bespoke allowances or student loans. Treat the output as a precise planning figure and confirm with an accountant.
Yes. Choose the custom profile and enter your own bands, thresholds and social contribution rates. The engine applies any number of bands progressively.
Official resources & government references
Verified references, primary standards specifications, and official publications governing the rules and calculations implemented in this tool:
Self Assessment Tax Rates, Allowances and Thresholds
Statutory UK Income Tax bands, Class 2/4 National Insurance rates, and Personal Allowance thresholds.
Official Income Tax Calculator & Estimate Service
Official UK government tool to check your personal tax code and verify annual deductions.
Self-Employment Tax (Social Security & Medicare Taxes)
Official US federal instructions for Schedule SE and quarterly estimated tax payments.
Important Disclaimer
Income and self-employment tax projections apply baseline statutory income tax and National Insurance brackets. Actual tax liabilities depend on your business legal structure (sole trader vs limited company), allowable expenses, pension tax relief, student loans, and payments on account. Always confirm tax figures with HMRC, the IRS, or a licensed accountant.