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Accountant@Work
[email protected], Accountant
Category: Tax
Satisfied Customers: 618
Experience:  Executive Director at [email protected]
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I Want to Know Tax rate for Sole trader

Customer Question

I Want to Know Tax rate for Sole trader
Submitted: 19 days ago.
Category: Tax
Expert:  [email protected] replied 19 days ago.

Hi, welcome to JustAnswer. I'm [email protected], a UK-Qualified Chartered Certified Accountant with over 15 years of experience. I'll be answering your question today.

Expert:  [email protected] replied 19 days ago.

Your income tax rates are the same as employees.

However, a sole trader will pay the following taxes

Class 2 NIC £3.15 per week or £163.80 per annum

Class 4 NIC at 10.25% on profits above £9,880

Income tax at 20% on total income after the tax-free allowance (£12,570) of up to a limit of £37,700 and 40% on income above it.

Customer: replied 19 days ago.
For Business Account?
Expert:  [email protected] replied 19 days ago.

sole traders are considered self employed persons

Expert:  [email protected] replied 19 days ago.

You are taxed on the profits, not on the income earned.

Expert:  [email protected] replied 19 days ago.

Correction:

Class 4 NIC at 10.25% on profits above 11,908 and not £9,880 ( rates changed 

Expert:  [email protected] replied 19 days ago.

I hope I've answered your question? If, however, any part of my response is unclear, please do let me know and I'll try to explain it further.