cancel
Showing results for 
Search instead for 
Did you mean: 
Highlighted
Intuit
1 helpful vote

Income Tax Calculation

You will pay Income Tax based on your Net Profit. Net Profit is the difference between your Total Income and your Total Allowable expenses. This is reflected on your Self-Assessment Summary page.

2016-2017 Tax rate

User-added image

These rates assume that you have a full personal allowance, which is not always the case if you have things such as employment benefits (your personal allowance is the first bit of income that is not taxed- the standard tax free personal allowance is £11,500.

Sample Computation:Net Profit is £24,000It falls under the 20% bracket, so:(£24,000 - £11,501) * 20%£12, 499 * 20%Income Tax: £2, 499.8

Net Profit is £50,000It falls under the 40% bracket, so:(£50,000 - £45,001) * 40%£4,999 * 40%Income Tax: £1,999.6

 

Was this helpful?

You must sign in to vote, reply, or post