By profit
Tax on a £90,000 sole trader profit, and where VAT fits in
A profit that matches the VAT registration figure, which is why so many sole traders at this level confuse the two tests.
A sole trader who makes £90,000 of profit in 2026/27 pays £23,432 of Income Tax and £3,057 of Class 4 in England, Wales or Northern Ireland, a bill of £26,489 that leaves £63,511. In Scotland the bill is £29,289. The figure shares its digits with the VAT registration threshold, yet the two tests look at different things. VAT depends on taxable turnover, meaning sales before any costs, over any rolling twelve months, not on profit for the tax year. Registration is compulsory once that turnover goes over £90,000, or when you expect it to go over in the next 30 days. A web developer with almost no costs and £90,000 of profit is sitting right on the line, while a joiner with the same profit and £40,000 of timber and fixings crossed it months earlier. For Income Tax, nothing changes at this figure: the higher rate of 40 % continues until the allowance taper begins at £100,000.
Self Assessment bill 2026/27
£26,489
Put aside 29.4 % of your profit · next £100 of profit costs 42.0 %
| Profit | £90,000 |
| Income Tax | £23,432 |
| Class 4 National Insurance | £3,057 |
| Class 2 | treated as paid |
| Kept from your profit | £63,511 |
When you pay, if 2026/27 is your first year
| 31 January 2028: bill + first payment on account | £39,733 |
| 31 July 2028: second payment on account | £13,244 |
Each payment on account is half of £26,489 (Income Tax and Class 4, loans excluded). How payments on account work
Making Tax Digital at this turnover
Turnover of £90,000 is over the £50,000 test. If your 2024/25 return showed income like this, quarterly updates start on 6 April 2026. Check your start date
Figures checked by Radif Partners · Editorial policy · How we calculate
Two numbers that only look the same
Income Tax and Class 4 are worked out on profit for the tax year, after allowable expenses. VAT registration looks at taxable turnover, the total value of what you sell that is not exempt or out of scope, and it counts zero-rated sales too. The two can be far apart. The table runs five sole traders through both tests: each one's tax bill depends on the profit column, while the VAT question depends only on sales.
| Trade | Sales in 12 months | Costs | Profit | Over £90,000? | Tax and Class 4 |
|---|---|---|---|---|---|
| IT consultant | £92,000 | £2,000 | £90,000 | Yes | £26,489 |
| Illustrator | £90,000 | £0 | £90,000 | No | £26,489 |
| Joiner | £130,000 | £40,000 | £90,000 | Yes | £26,489 |
| Online seller of homeware | £160,000 | £70,000 | £90,000 | Yes | £26,489 |
| Wedding photographer | £88,000 | £8,000 | £80,000 | No | £22,289 |
The illustrator with £90,000 of sales and no costs is not over the threshold, because the rule bites on turnover going over it, not reaching it. One extra commission changes that. The VAT threshold page has a checker for your own months.
A rolling twelve months, not the tax year
The VAT test does not wait for the end of the tax year. At the end of every month you look back over the previous twelve, and if taxable sales have gone over £90,000, you have 30 days from the end of that month to register. Registration then takes effect from the first day of the second month after the one in which you went over. A second test looks forward: a contract signed today that will push sales over the threshold within the next 30 days means registering by the end of that period, effective from the day you realised. A seasonal business, such as a garden designer whose sales bunch into spring, can pass the line partway through a tax year whose total ends below it.
The tax itself at £90,000
Nothing new starts here for Income Tax. The profit sits £39,730 into the higher-rate band, where each pound pays 40 % plus 2 % Class 4, and £10,000 short of the point where the Personal Allowance starts to shrink. In Scotland the higher rate started at £43,663 and the last £15,000 of profit is in the advanced band, so the bill there is £2,800 higher. Payments on account for the next year are £13,244 each, due 31 January 2028 and 31 July 2028, so a first year at this level means finding £39,733 in one January. The set-aside calculator turns that into a monthly figure.
Staying under, or registering by choice
Registration below the threshold is allowed: HMRC calls it voluntary registration, and the same duty applies once it is granted, with VAT owed from the date you are registered. A business that sells only VAT-exempt goods or services does not have to register at all, whatever its turnover. Which side of the line suits a particular trade depends on its customers and its costs, not on the Income Tax figures above.