Tax and National Insurance payments made to HM Revenue & Customs (HMRC) are different for a self-employed person to that of somebody working under pay as you earn (PAYE).

Self Employed Tax Rates & Allowances

The actual rates of tax, allowances and rates of National Insurance for 2014/15  are detailed on the following page along with comparison tables from 2013/14.

If you would like Tax Advantage to help with your taxes please use the contact form and we will provide you with a no obligation quote.

As a self-employed person the tax and National Insurance you will have to pay to HM Revenue & Customs is different to that of somebody working under PAYE.

Income Tax Allowances 2013/14 2014/15
Personal Allowance born after 5th April 1948 9,440 10,000
Income limit for Personal Allowance (see note 1) 100,000 100,000
Personal Allowance born between 6th April 1938 and 5th April 1948 10,500 10,500
Personal Allowance born before 6th April 1938 10,660 10,660
Married Couples Allowance, born before 6th April 1935 7,915 8,165
Age allowance income limit 26,100 27,000
Minimum Married Couples Allowance 3,040 3,140
Blind Persons Allowance 2,160 2,230
  1. Personal Allowance is reduced by £1 for every £2 over £100,000 of income.
  2. Age Allowance is reduced by £1 for every £2 over the ‘age allowance income limit’ however it will not be reduced below the standard Personal Allowance unless your income exceeds £100,000.
  3. Married couples allowance is only available to those born before the 6th April 1935, the allowance is given at 10%
Income Tax Rates 2013/14 2014/15
Savings starting rate at 10% £0-2,790 £0-2,880
Basic rate at 20% £0-£32,010 £0-£31,865
Higher rate at 40% £32,011 -£150,000 £31,866 – £150,000
Additional rate at 45% £150,000 + £150,000 +
Dividend Basic rate 10% 10%
Dividend Higher rate 32.5% 32.5%
Dividend Additional rate 37.5% 37.5%
National Insurance Contributions 2013/14 2014/15
Primary Class 1 Lower earnings limit 109 111
Primary Class 1 Upper earnings limit 797 805
Upper accrual point 770 770
Primary threshold 149 153
Secondary Threshold 148 153
Employees Class 1 rate from primary threshold to upper earnings limit 12% 12%
Employees Class 1 rate over upper earnings limit 2% 2%
Class 1A rate on employer benefits 13.8% 13.8%
Contracted out rebate for employees 1.4% 1.4%
Married women’s reduced rate from primary threshold to upper earnings limit 5.85% 5.85%
Married women’s rate above upper earnings limit 2% 2%
Employers secondary Class 1 above secondary threshold 13.8% 13.8%
Employers contracted out rebate on salary schemes 3.4% 3.4%
Employers contract out rebate on money purchase schemes N/A N/A
Class 2 2.70 2.75
Class 2 small earnings exception 5,725 5,885
Class 3 13.55 13.90
Class 4 9% 9%
Class 4 lower profit limit 7,755 7,755
Class 4 upper profit limit 41,450 41,865
Class 4 above upper profit limit 2% 2%