untied's tax calculation - what it means

The tax in untied is a guide but it's only after you submit that HMRC actually tells you formally what is due (this may come by letter or email).

What the tax number at the top of your screen means

When we were designing tax summary at the top of the transaction screen, we had lots of discussions what people wanted to see. These are accurate calculations, but it's important to know what is and is not taken account of.

The calculation is what will appear in your tax return. It's based on a year's standard personal allowance, without adjusting for your own allowance or amended tax code (because this all happens at HMRC's end after the return is submitted).

While it's an indication during the year, it's worth understanding how we do it. It's most useful once a tax year is done and before you've submitted.

It doesn't take account of where you are in the year - so midway through the year if you've earned £13,000 as self-employed for the six months from April to September, you will see only a small amount of tax due (the personal allowance is just over £12,500, noting that national insurance is also due). And that tax will increase during the following six months in the lead up to the end of the tax year.

If you also have a salary that is effectively "taking up" the personal allowance, again that won't show until you enter the details.

Paying tax

After you submit, HMRC will tell you what tax is due - see Paying your tax to HMRC.

If there is a small amount due, it is unlikely that you will need to pay anything as the adjustment will be made again through your tax code.