How much tax should a handyman set aside? Tax and allowable expenses for 2025/26
A handyman's income comes from lots of small jobs for lots of customers, which is the hardest kind to keep tidy. The tax is still just a share of profit, so it is the record that decides whether the share is right.
What the tax looks like
Using the 2025/26 rates (England, Wales or Northern Ireland, no other income), a handyman with £38,000 of takings and £7,500 of allowable costs has £30,500 of profit and about £4,662 of income tax and Class 4 National Insurance for the year, roughly £388 a month. The figures are an illustration, not an average for the trade. Tax is on profit, not takings.
| Profit for the year | Income tax + Class 4 NI | Per month | Per £1 of profit |
|---|---|---|---|
| £18,000 | £1,411.80 | £118 | 8p |
| £30,500 | £4,661.80 | £388 | 15p |
| £46,000 | £8,691.80 | £724 | 19p |
Open the calculator already filled in with this example and change the two numbers to yours. It also shows the January and July payment dates.
Costs a handyman usually claims
Claim only what you actually spent on the business, and only the business share of anything you also use personally.
- Materials bought for jobs: timber, sealant, fixings, paint.
- Tools: hand tools, power tools, ladders and a work bench.
- Van or car costs: fuel, insurance, repairs, or the flat mileage rate.
- Waste disposal: tip fees and skip hire for jobs.
- Insurance: public liability for work in other people's homes.
- Advertising: local directories, leaflets, online listings.
The general list is on GOV.UK: self-employed expenses you can claim, and what you can't. If your costs for the year are under £1,000, the trading allowance may leave you less tax.
When CIS applies to a handyman
CIS is about who is paying you. If you do construction work for a contractor under the scheme, they deduct from your payments (20% if registered, 30% if not, nothing with gross payment status), and the deduction counts as an advance payment of your tax. If a householder pays you, there's nothing to deduct and the whole amount is yours to set tax aside from. Many handymen get both. Ask the person paying you whether they operate CIS, and keep each type of payment on its own line so the year's total is easy to separate. The deduction base excludes VAT, materials you paid for directly, and other items GOV.UK lists.
VAT
£90,000 of taxable turnover in any 12 months triggers VAT registration. Handymen usually aren't close, but add up the last 12 months if the year was busy.
Records worth keeping
- Keep a job sheet: date, customer, price, materials. It doubles as proof for small disputes.
- Photograph receipts at the till. Paper fades.
- If you buy from a merchant on account, keep the monthly statement and the invoices behind it.
- Keep personal and business spending apart, even if both come out of the same card.
For a mixed job book: record each job's income and materials in the boxes the return uses: the SortedDesk Self Assessment Spreadsheet is a one-off £4.99 download for Excel and Google Sheets. It is a spreadsheet only: nothing here files anything with HMRC, and the sheet doesn't replace an accountant if your case is complicated.
Dates matter too: the 2025/26 return and tax are due on 31 January 2027, and payments on account can make that January bigger than the year's bill.
This is a planning guide, not tax advice. Figures worked with the calculator's 2025/26 rules, and GOV.UK sources read on 21 October 2026: Expenses if you're self-employed, CIS: make deductions and pay subcontractors, Simplified expenses: vehicles, When to register for VAT.
Try the calculator with this example