Guide to setting up as a Sole Trader

There are many ways you can begin your business journey and setting up as a sole trader is one of those options, along with being a Partnership, Limited Company, CIC, etc.

A sole trader is an individual who has exclusive ownership over the business so benefits from keeping all profits after tax but that brings the drawback of being personally liable for all losses and debts.

As a sole trader you must submit a self-assessment to HMRC to calculate the tax you owe, the deadline and payment must be made by 31^st January of the following year – the tax year runs from 6^th April to 5^th April. To help keep track of your invoices we have the facilities to store your receipts on our cloud platform so when it’s time to complete your assessment we’ll have everything ready and organised.

Registering as a Sole Trader

It is relatively easy to set up as a sole trader but you must notify HMRC within three months of starting to operate. Click here to visit HMRC’s website to begin registering online to become a sole trader.

We have broken this guide down into bitesize chapters for easy digesting:

1. What is a sole-trader and how to register?
2. Difference between a sole-trader and limited company
3. HMRC taxes to pay as a sole-trader (+ VAT)
4. Claiming for business expenses
5. Information on business insurance