Etsy Tax Calculator UK 2026/27
Use this Etsy tax calculator to estimate UK tax on handmade, digital product or craft shop income after allowable business costs.
Income Tax uses England, Wales and Northern Ireland bands. Class 4 NI uses trading profit separately from salary. Scottish taxpayer? Use Scottish rates. Methodology and limitations · Filing deadlines
Calculated estimate
Tax Calculation Results
This estimate used Scottish income tax bands because Scotland is selected.
- Estimated take-home profit
- ~£
- Additional Income Tax
- ~£
- National Insurance
- ~£
| Main Income: | £ |
| Side Hustle Income: | £ |
| Deduction used: | £ |
| Side Hustle Profit: | £ |
| Estimated Additional Income Tax: | ~£ |
| Estimated National Insurance Contributions: | ~£ |
| Estimated Total Additional Tax (Income Tax + NI): | ~£ |
| Estimated Effective Tax Rate (Income Tax + NI): | % |
This estimates additional tax on trading profit, not your total Self Assessment bill. It excludes student loans, pensions, benefits, VAT, loss relief, tailored tax codes and Class 1/Class 4 annual NI maximum adjustments. Class 2 is not added to the bill. Payments on account may affect cash due. Check MTD assessment years and exemptions; this result does not determine eligibility.
How to use this etsy tax calculator uk
Use this Etsy tax calculator to estimate UK tax on handmade, digital product or craft shop income after allowable business costs.
The calculator is intended for taxable shop activity. A small hobby can become a trade when you make or buy items with a view to selling them for profit.
Etsy shop profit is usually calculated after business costs such as materials, postage, packaging, Etsy fees and other allowable expenses. VAT, imports and stock accounting can need separate advice.
- Use Side Hustle Income for gross income before expenses or allowances.
- Use Side Hustle Expenses for actual allowable expenses; select the trading allowance separately if eligible.
- Use Annual Salary for your PAYE salary before tax.
Trading Allowance vs Actual Expenses
The trading allowance can exempt up to £1,000 of gross trading income. If your gross trading income is £1,000 or less, you may not need to tell HMRC, although some circumstances still require a tax return.
If gross trading income is more than £1,000, you can usually choose between deducting the £1,000 trading allowance or deducting actual allowable expenses. You cannot claim both for the same trade.
Self Assessment registration and deadlines
If you cross the £1,000 trading allowance you normally need to register for Self Assessment by 5 October after the tax year ends, and file online by 31 January after the tax year. See the main Self Assessment registration and deadlines section for year-specific dates and payments-on-account rules.
Budget for payments on account · MTD assessment years · Higher-rate tax explained
Official Sources
Etsy Tax Calculator UK examples
Example 1
Hobby seller testing a few handmade items and checking whether gross trading income stays within the £1,000 allowance.
Example 2
Part-time handmade seller with materials, postage, packaging, Etsy fees and photography costs to model as expenses.
Example 3
Larger shop monitoring gross income because Making Tax Digital thresholds look at qualifying income before expenses.
FAQs
Is my Etsy shop a hobby or a trade?
HMRC looks at the facts, including regularity, profit motive, business-like activity and whether items are made or bought to sell. A profit-seeking shop is more likely to be trading.
Can I deduct materials and postage?
For taxable trading, materials, postage, packaging, Etsy fees and other business costs are typical expenses to consider when calculating profit.
Are Etsy fees allowable expenses?
Fees charged for listing, transactions, payment processing or advertising can usually be considered business costs where they relate to the trade.
How should I handle stock?
Stock and materials can need careful record keeping, especially if you buy items before they are sold. Keep invoices and track what relates to business sales.
Does this calculator cover VAT?
No. It estimates Income Tax and Class 4 National Insurance only. VAT registration and marketplace VAT rules are separate.
When do Etsy sellers need Self Assessment?
You normally need to check Self Assessment if gross trading income is over £1,000 in the tax year or HMRC asks you to file.
More Side Hustle Tax Calculators
Compare other side-hustle scenarios using the same privacy-safe calculator. If you also want a general view across PAYE plus any additional earnings, use the UK extra income tax calculator.
Handmade sales and platform costs
Record gross sales before platform deductions. Materials, stock, listing fees, transaction fees, postage and packaging may be allowable trading costs. Separate personal-use materials and personal possession sales.
Worked example for 2026/27
£8,000 handmade sales less £3,000 materials, fees and postage leaves £5,000 profit. With £30,000 PAYE salary, additional Income Tax is £1,000 and Class 4 NI is £0 under England, Wales and Northern Ireland rates.
2026/27 rates used by this calculator
Standard Personal Allowance: £12,570. It reduces by £1 for every £2 of income above £100,000. Pension and other adjustments are outside this estimate.
| Band | Band width after Personal Allowance | Income Tax rate |
|---|---|---|
| Basic | First £37,700 | 20% |
| Higher | Next £87,440 | 40% |
| Additional | Remaining taxable income | 45% |
Class 4 NI is 6% on annual self-employed profit above £12,570 up to £50,270, then 2% above £50,270. PAYE salary does not consume these profit bands. The estimate does not apply Class 1/Class 4 annual maximum adjustments.
Class 2 is treated as paid at profits of £7,105 or more; below this, voluntary Class 2 is £3.65 per week. It is not included in the calculated bill.
Income Tax rates · Scottish rates · Current and archived NI rates