The UK income tax calculator is available in various versions according to the taxpayers’ employment status—employed, self employed, or a combination of both. For accuracy, it is crucial to use the right tool, as the rates of National Insurance in the UK and other types of deductions are different for an employee and a sole trader.
This article explores employed vs self-employed taxes, which UK tax calculator and other tools to use for accurate estimate of income tax and take-home pay, 2023 to 2025 income tax rates, relevant FAQs, and the most recommended way to improve tax compliance.
Employed Vs. Self-Employed
As employees are under the Pay as You Earn (PAYE) tax system and the self-employed under self-assessment, the UK income tax calculator 2024 should be used accordingly. Some online services offer simplified calculators for taxpayers who are under both statuses.
Filing the 2023/24 tax returns will be due on or before 31 January 2025, so it is best to determine earlier how much take-home pay individuals can get from their hard-earned salary after the applicable deductions so they can file promptly and budget their expenses beforehand.
The UK government site offers the UK income tax calculator to estimate self-assessment tax bill for the self employed, including income tax and class 2 and 4 National Insurance contributions. HMRC app also comes in very handy for sole traders to get relevant tax information, not only self-assessment calculations. Employees may check the Gov.UK site for their tool
The app is downloadable on both Android and iOS, alongside the HMRC helpline available for any enquiries. However, whilst the UK government’s online services are easily accessible, they only cater to those with straightforward tax situations and do not include other deductions such as a student loan or state pension payment.
Many sites integrate tax software to offer UK income tax calculator with pension and other deductions, UK income tax calculator monthly, previous tax year calculations, and/or simplified calculators for those who have both employment statuses.
For more customised and thorough guidance, it is most recommended for taxpayers to consult tax advisors in the process, as they can guide clients on how to use a UK tax calculator themselves, help with the accuracy of calculations and promptness of filing tax return, and streamline any tax affairs overall.
Income Tax Rates for 2023/24 and 2024/25
The system of taxation in England and Wales differs from Scotland’s, which is why all UK tax calculators come with the Scotland checklist options. However, personal tax-free allowance remains the same, which is at £12,570 for the current tax year. England, Wales, and Northern Ireland pay income taxes as follows:
| TAX BANDS | TAXABLE INCOME | TAX RATES |
|---|---|---|
|
Basic Rate |
Between £12,571 and £50,270 |
20% |
|
Higher Rate |
Between £50,271 and £125,140 |
40% |
|
Additional Rate |
More than £125,140 |
45% |
Scottish income tax, on the other hand, previously had five tax bands. However, beginning April 2024, the new advanced rate tax band was added. For the 2024/25 tax year, the rates are as follows:
| TAX BANDS | TAXABLE INCOME | TAX RATES |
|---|---|---|
|
Starter Rate |
Between £12,571 and £14,876 |
19% |
|
Basic Rate |
Between £14,877 and £26,561 |
20% |
|
Intermediate Rate |
Between £26,562 and £43,662 |
21% |
|
Higher Rate |
Between £43,663 and £75,000 |
42% |
|
Advanced Rate |
Between £75,001 and £125,140 |
45% |
|
Top Rate |
More than £125,140 |
48% |
All income more than £125,140, no matter where the taxpayer is in the UK, will be levied without personal tax-free allowance.
Income Tax Calculator
Frequently Asked Questions
The current income tax rates in the UK are foreseen to remain the same until 2028.
The UK’s tax year begins on 6 April and ends on 5 April the next year.
Most taxpayers in the UK are under the PAYE system, in which they receive a tax code from HMRC that shows their income tax and NI payments, tax reliefs, and more
Taxpayers must determine their filing status, add all their incomes, and make applicable deductions to determine their tax bill.
Why Legend Financial for Your Tax Returns?
The government’s online services may be sometimes too standardised, as they assume only income tax and NI deductions and do not include other possible elements such as student loans, pension contributions, and more. They may not be too reliable when taxpayers want to accurately determine their take-home pay.
Legend Financial uses the most updated UK tax calculator, guides clients throughout the next process, and ensures they are tax compliant in every way. From accurate tax calculations to filing your returns, you will get the most comprehensive assistance from our tax experts. Reach us today for your tax needs!
