If you've started working for yourself, HMRC needs to know. Registering as self-employed is free, takes about 15 minutes online, and must be done by 5 October after the end of the tax year in which you started.
This guide covers whether you count as self-employed, how to register step by step, and what to set up once you have.
What is self-employed?
You're self-employed if you run your own business and take responsibility for whether it succeeds. Signs that you are:
- You decide how, when and where you do the work
- You can send someone else to do it, or hire help
- You set your own prices and can make a loss
- You have several customers, or are free to
- You provide your own tools and equipment
Plenty of people are employed and self-employed at the same time: a salaried job plus freelance work, or a side business selling online. The self-employed part still has to be registered.
If a client treats you like an employee (fixed hours, their equipment, no right to send someone else), you may be employed for tax purposes. If you work through your own limited company, that's a company director, not self-employment, and different rules apply.
Do you need to register?
You need to register if your self-employed income was more than £1,000 (before expenses) in a tax year. That £1,000 is the trading allowance: below it, you don't need to tell HMRC.
You should also register if you want to pay voluntary Class 2 National Insurance to protect your State Pension, or to prove you're self-employed, for example for Tax-Free Childcare or a mortgage.
Selling online? Platforms such as eBay, Etsy, Vinted and Airbnb now send HMRC details of sellers who pass their reporting limits. Selling your own unwanted things isn't trading, but buying to resell or making goods to sell is.
When to register as self-employed
The deadline is 5 October after the end of the tax year (6 April to 5 April) in which you started:
- Started between 6 April 2025 and 5 April 2026 — register by 5 October 2026
- Started between 6 April 2026 and 5 April 2027 — register by 5 October 2027
You can register as soon as you start trading, and it's best to. It gives you time to get your UTR and set up your records before your first return.
Missed the deadline? Register now. The penalty for late registration is based on the tax still unpaid on 31 January. If you file your return and pay in full by then, there's usually no penalty.
How to register as self-employed, step by step
- Get your details ready: National Insurance number, home address, contact details, the date you started, your business name if you use one, and what the business does.
- Go to GOV.UK and search for "Register for Self Assessment". Choose that you're self-employed or a sole trader.
- Sign in or create a Government Gateway account. Keep the user ID safe: you'll use it for your tax account and to file.
- Answer the questions about yourself and the business, then submit.
- Wait for your UTR. Your Unique Taxpayer Reference, a 10-digit number, arrives by post, usually within about 10 days and longer if you're abroad. You need it to file a return and to connect accounting software.
Already file Self Assessment, for example for rental income? You still need to tell HMRC about the new business, but you keep the same UTR.
After you register
Keep records from day one
Record every sale and every business cost, and keep receipts. A separate bank account for the business makes this far easier. Most sole traders use the cash basis: income counts when you're paid, and costs count when you pay them.
Set money aside for tax
Nobody deducts tax for you. Put aside around 25–30% of your profit. Our guide to self-employed tax shows the 2026/27 rates and worked examples.
Self-employed insurance
Most insurance isn't compulsory for sole traders, but it's often worth having:
- Public liability: if a customer or member of the public is injured or their property is damaged. Often required to work on site.
- Professional indemnity: if you give advice or provide a service and a client claims you got it wrong.
- Employers' liability: a legal requirement once you employ staff.
- Business use on your car insurance, and cover for tools, stock and equipment.
Premiums for business insurance are an allowable expense.
Self-employed pension
There's no employer adding to your pension, and no automatic enrolment. A personal pension or SIPP gets tax relief at your top rate: the provider adds 20%, and higher-rate taxpayers claim the rest on their return. Keep your National Insurance record up to date too: if your profits are under £7,105, voluntary Class 2 costs £3.65 a week in 2026/27.
VAT
You only must register for VAT if your taxable turnover goes over £90,000 in any rolling 12 months. You can register voluntarily below that if it helps, for example if your customers are VAT-registered businesses.
Making Tax Digital: what's coming
Once your qualifying income (gross self-employment plus property income) is high enough, you must keep digital records and send HMRC a quarterly update every three months:
- Over £50,000 — from 6 April 2026
- Over £30,000 — from 6 April 2027, based on your 2025/26 return
- Over £20,000 — from 6 April 2028
If you're starting out, keeping digital records now means nothing changes when MTD reaches you. Read what MTD from April 2027 means for sole traders, or check your position with our MTD ITSA readiness checker.
Start your self-employed bookkeeping with AccLedger
AccLedger's sole trader software gets a new business set up in minutes: connect your bank, send invoices, snap receipts and log mileage. It shows a live estimate of your tax as you go, and your SA103 figures come straight from your books. When Making Tax Digital applies to you, it prepares each quarterly update for you to review and submit to HMRC.
The Sole Trader plan is £7.50 a month. Start a 30-day free trial — no card needed.
Frequently asked questions
How do I register as self-employed? Online on GOV.UK, through "Register for Self Assessment", choosing self-employed. You'll need your National Insurance number and a Government Gateway account. It's free.
What is the deadline to register as self-employed? 5 October after the end of the tax year in which you started. If you started in 2026/27, that's 5 October 2027.
How long does it take to get a UTR? Usually around 10 days by post, and longer if you live abroad.
Can I be employed and self-employed at the same time? Yes. Your employer deducts tax from your salary as normal, and you report the self-employed profit on your Self Assessment return.
Do I need to register if I earn under £1,000? No. Self-employed income of £1,000 or less a year is covered by the trading allowance, unless you need to file a return for another reason.
Do I need insurance to be self-employed? It isn't a legal requirement unless you employ people, when employers' liability cover is compulsory. Public liability and professional indemnity are common and often asked for by clients.
Is registering as self-employed the same as setting up a company? No. A sole trader registers with HMRC for Self Assessment. A limited company is registered with Companies House and has its own tax. See sole trader vs limited company.
This article is general guidance based on HMRC rules as of October 2026 and is not tax advice. Register only through the official GOV.UK service — it's free.