Self-employed tax calculator (US 1099 and UK sole trader)
Freelancing for remote clients means no employer withholding. In the US you pay 15.3% self-employment tax on 92.35% of profit on top of federal income tax: on $80,000 of 1099 profit that is about $11,304 SE tax plus $5,344 income tax (after half-SE and the 20% QBI deduction), leaving $63,353. A UK sole trader on £50,000 profit pays £7,486 income tax and £2,246 Class 4 NI at 6%, keeping £40,268.
Example: $80,000 1099 profit (US)
| Gross pay | $80,000 |
|---|---|
| Self-employment tax (Social Security + Medicare) | −$11,304 |
| Federal income tax | −$5,344 |
| Take-home pay (year) | $63,353 |
| Take-home pay (month) | $5,279 |
| Effective deduction rate | 20.8% |
Example: £50,000 sole trader profit (UK)
| Gross pay | £50,000 |
|---|---|
| Income tax | −£7,486 |
| Class 4 National Insurance | −£2,246 |
| Take-home pay (year) | £40,268 |
| Take-home pay (month) | £3,356 |
| Effective deduction rate | 19.5% |
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Frequently asked questions
How much should I set aside for taxes as a 1099 contractor?
Roughly 25-30% of profit for federal tax and self-employment tax on a mid-range income, plus your state rate. On $80,000 profit this calculator estimates 20.8% before state tax.
Do UK sole traders still pay Class 2 NI?
No. Class 2 contributions were abolished from 6 April 2024; you pay Class 4 at 6% between £12,570 and £50,270 and 2% above, and can pay voluntary Class 2 to protect your State Pension if profits are low.
Is the QBI deduction included?
Yes, a simplified 20% qualified business income deduction is applied when taxable income is under the 2026 threshold. Specified service businesses above the threshold get less.
What about EU freelancers?
EU self-employed rules differ heavily by country (e.g. Spain autónomo quotas, Netherlands zelfstandigenaftrek). Use the freelance rate calculator with your country's typical total tax rate, then confirm with a local adviser.