Let’s be honest—most of us got into freelancing because we love the freedom, flexibility, and ability to work on projects we’re passionate about. The last thing any freelancer dreams about is tax deadlines and HMRC paperwork.
Yet understanding when freelancers pay taxes in the UK is absolutely critical to your success and financial stability as a self-employed professional.
After spending over a decade working with thousands of freelancers through my blog and online community, I’ve seen firsthand how tax confusion can derail even the most talented independent professionals. The good news? Mastering the UK freelance tax timeline isn’t nearly as complicated as most people think.
In this comprehensive guide, I’ll walk you through exactly when UK freelancers need to pay their taxes, what deadlines you need to mark on your calendar, and practical strategies to ensure you never miss a payment again.
UK Freelancer Tax Deadlines: The Essential Calendar
As a UK freelancer, your tax year runs from April 6th to April 5th of the following year (not January to December like many other countries). This is crucial to understand since all your tax deadlines revolve around this schedule.
Here are the key dates every UK freelancer needs to know:
October 31st
Paper self-assessment deadline: If you’re submitting your tax return via post (which very few freelancers do nowadays), this is your deadline. I strongly recommend filing online instead, as it gives you an additional three months and typically provides immediate confirmation that HMRC has received your submission.
January 31st
This is the big one—arguably the most important date in the UK freelancer’s calendar. January 31st is a triple deadline:
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Online self-assessment deadline: Your completed tax return for the previous tax year must be submitted to HMRC by midnight.
Payment deadline for your tax bill: Any income tax you owe for the previous tax year must be paid in full by this date.
First payment on account for the current tax year: If your tax bill exceeds £1,000, you’ll also need to make your first payment on account (essentially an advance payment toward your current year’s tax bill).
July 31st
Second payment on account deadline: If you’re making payments on account, the second installment for your current tax year’s estimated tax bill is due by this date.
Missing these deadlines results in automatic penalties that increase the longer you delay. HMRC charges £100 immediately for late filing, with additional penalties accruing after 3, 6, and 12 months. Late payments also incur interest charges, making procrastination a costly mistake.
Understanding the UK Freelancer Tax System
Before we dive deeper into payments, it’s important to understand exactly what taxes UK freelancers need to pay:
Income Tax
As a freelancer, you pay income tax on your profits (not your total income). Your profit is calculated by taking your total freelance income and subtracting your allowable business expenses.
For the 2024/25 tax year, the personal allowance remains at £12,570. This means your first £12,570 of profit is tax-free. After that, you’ll pay:
Basic rate (20%): On profits between £12,571 and £50,270
Higher rate (40%): On profits between £50,271 and £125,140
Additional rate (45%): On profits over £125,141
Remember, if you have employment income alongside your freelance work, these thresholds apply to your combined income.
National Insurance Contributions (NICs)
As a self-employed person, you’ll need to pay two types of National Insurance:
Class 2 NICs: A flat weekly rate (currently £3.45) for those with profits above £6,725 per year.
Class 4 NICs: A percentage-based contribution calculated as 9% of profits between £12,570 and £50,270, and 2% on profits above that threshold.
These NICs are calculated and paid through your self-assessment tax return, so they share the same payment deadlines as your income tax.
Value Added Tax (VAT)
If your freelance business turnover exceeds £85,000 in a 12-month period, you’ll need to register for VAT. Once registered, you’ll need to submit quarterly VAT returns and make payments according to your assigned VAT quarters.
How Payments on Account Work for UK Freelancers
One aspect of the UK tax system that often catches new freelancers off guard is the payments on account system. Here’s what you need to know:
If your tax and Class 4 NICs bill exceeds £1,000 for the tax year (which is very likely for most full-time freelancers), HMRC requires you to make advance payments toward your next year’s tax bill.
These payments on account are each equal to 50% of your previous year’s tax bill, and they’re due on January 31st and July 31st.
Let’s look at a practical example:
Imagine your 2023/24 tax year bill comes to £8,000. Here’s your payment schedule:
January 31, 2025: You’ll pay your full 2023/24 tax bill (£8,000) PLUS your first payment on account for 2024/25 (£4,000) – making a total payment of £12,000.
July 31, 2025: You’ll pay your second payment on account for 2024/25 (another £4,000).
If your income for 2024/25 ends up being lower than the previous year, you can apply to reduce your payments on account. Conversely, if you earn more, you’ll pay the difference when you file your return the following January.
This system catches many freelancers by surprise in their second year of business, when they suddenly face a much larger January payment than expected. At SolidGigs, we’ve seen countless freelancers get into financial trouble because they weren’t prepared for this payment structure.
Practical Tax Management for UK Freelancers
Now that you understand when taxes are due, let’s talk about practical strategies to manage your tax obligations:
Set Up a Dedicated Tax Savings Account
One of the most effective habits you can develop as a freelancer is to automatically set aside a percentage of every payment you receive specifically for taxes.
I recommend setting up a separate savings account specifically for tax funds. After each client payment, immediately transfer 25-30% of the income into this account. This creates a buffer that ensures you’ll have funds available when tax deadlines arrive.
Keep Detailed Records Year-Round
Maintaining organized financial records throughout the year makes tax season significantly easier. Consider using accounting software like FreshBooks, which many of our freelancer community members at SolidGigs recommend.
These tools allow you to:
Track your income and expenses in real-time so you always know your tax position
Store digital copies of receipts and invoices so you’re not scrambling at the last minute
Generate profit and loss reports that make completing your self-assessment straightforward
Register for Self-Assessment Early
If you’re new to freelancing, don’t wait until the deadline approaches to register for self-assessment. HMRC requires you to register by October 5th following the tax year in which you started self-employment.
The registration process involves:
Registering as self-employed with HMRC
Receiving your Unique Taxpayer Reference (UTR)
Setting up your Government Gateway account for online filing
This process can take several weeks, so starting early gives you plenty of time to get everything in order.
Consider Making Voluntary Class 2 NICs
If your profits fall below the Small Profits Threshold (currently £6,725), you’re not required to pay Class 2 NICs. However, making voluntary contributions (just £3.45 per week) helps maintain your National Insurance record, which affects your eligibility for benefits like the State Pension.
Advanced Tax Planning for Established UK Freelancers
As your freelance business grows, consider these more advanced tax planning strategies:
Incorporate as a Limited Company
While most freelancers start as sole traders, incorporating as a limited company can offer tax advantages once your income reaches certain thresholds. This structure allows you to pay yourself through a combination of salary and dividends, potentially reducing your overall tax burden.
However, limited companies face additional administrative requirements, including filing annual accounts with Companies House and dealing with Corporation Tax (which has different payment deadlines).
Utilize the Trading Allowance
If you have very modest freelance income (perhaps as a side hustle), you can utilize the £1,000 trading allowance. This means the first £1,000 of trading income is tax-free, and you don’t need to report it to HMRC.
Consider Payment on Account Adjustments
If you know your income will be significantly different from the previous year, you can request to adjust your payments on account through your HMRC online account. This helps you avoid overpaying or underpaying throughout the year.
Common UK Freelancer Tax Mistakes to Avoid
Through my work with thousands of freelancers, I’ve seen the same tax mistakes repeated time and again:
Waiting Until the Last Minute
Many freelancers wait until January to even think about their tax return, leading to rushed submissions, missed deductions, and higher stress levels. Start gathering your information months in advance and aim to submit by December.
Failing to Budget for Payments on Account
As I mentioned earlier, the January payment is often much larger than expected because it includes your first payment on account. Budget accordingly!
Mixing Business and Personal Finances
Using the same bank account for business and personal transactions makes it incredibly difficult to accurately track your income and expenses. Open a separate business account, even as a sole trader.
Missing Allowable Expenses
Many freelancers miss legitimate tax deductions because they don’t understand what qualifies as an allowable expense. Take the time to learn what you can claim, including:
Home office expenses: A portion of your rent, utilities, and internet if you work from home
Software subscriptions: Tools and platforms needed for your work
Professional development: Courses, books, and training related to your field
Professional services: Accountant or bookkeeper fees
Marketing costs: Website hosting, business cards, advertising
Getting Professional Help with UK Freelance Taxes
While this guide covers the essentials of when UK freelancers pay taxes, there’s no substitute for professional advice tailored to your specific situation.
Consider hiring an accountant who specializes in working with freelancers. The cost is often offset by the tax savings they help you identify, not to mention the time you save and the peace of mind you gain.
Many members of our SolidGigs community report that working with an accountant was one of the best business investments they made, particularly as their freelance income grew more complex.
Tax Resources for UK Freelancers
Beyond working with an accountant, here are some valuable resources for understanding UK freelance taxes:
HMRC Self-Employment Resources: HMRC offers guides, webinars, and videos specifically for self-employed individuals.
Professional Associations: Many industry-specific freelance organizations offer tax guides tailored to your field.
Tax Apps and Software: Tools like FreshBooks, QuickBooks Self-Employed, or Bloom.io can help you track expenses, estimate tax bills, and even remind you of upcoming deadlines.
SolidGigs Resource Hub: Our growing library of freelance tax guides offers practical advice specific to UK freelancers’ needs.
Final Thoughts: Mastering the UK Freelance Tax Calendar
Understanding when to pay your taxes as a UK freelancer is just one part of building a sustainable and successful independent career. By mapping out these key dates and planning accordingly, you transform tax compliance from a source of stress into just another well-managed aspect of your business.
Remember, the most successful freelancers aren’t necessarily the ones with the most impressive client list or the highest day rate—they’re the ones who have systems in place to handle the business side of freelancing efficiently, including tax management.
The freedom that comes with freelancing is truly worth it, but it does require taking responsibility for areas that employers would typically handle for you. Tax compliance is one of those areas, and mastering it puts you leagues ahead of many of your peers.
For more insights on freelancing, tax management, and securing a steady stream of high-quality clients, consider joining SolidGigs. Our team curates the best freelance jobs from across the web and delivers them straight to your inbox each week, saving you hours of job searching so you can focus on what really matters—growing your business and delivering exceptional work to your clients.
Here’s to your freelance success!
UK Freelancer Tax FAQs
When is the deadline for registering as self-employed with HMRC?
You must register with HMRC by October 5th following the end of the tax year in which you began freelancing. For example, if you started freelancing in June 2024, you’d need to register by October 5, 2025.
What happens if I miss the January 31st payment deadline?
HMRC will charge interest on late payments from February 1st. If you haven’t paid by March 3rd, you’ll also face a 5% surcharge on the outstanding amount. Additional 5% surcharges are applied if the payment remains outstanding after 6 months and again after 12 months.
Do I need to make payments on account if I have a full-time job alongside my freelance work?
If your total Self Assessment tax and Class 4 NICs bill exceeds £1,000, you’ll need to make payments on account—even if you also have employment income. However, if enough tax is deducted from your employment through PAYE to cover your freelance income, you can apply to reduce your payments on account.
Can I pay my freelance tax bill in installments?
If you’re struggling to pay your tax bill, contact HMRC before the payment deadline to discuss setting up a Time to Pay arrangement. This allows you to spread payments over time, but is only available if you’ve filed your tax return on time.
Do I need to pay tax on my freelance income if I earn less than the personal allowance?
If your total income (including any employment income) is below the personal allowance threshold (£12,570 for 2024/25), you won’t pay income tax. However, you may still need to file a tax return and pay Class 2 NICs if your self-employed profits exceed £6,725.
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