Credit score

A credit score (also called a “credit rating”), is a number that banks use to figure out if a potential borrower is reliable or not.

In the UK, this number is calculated by consumer credit reference agencies, the most notable of which are Callcredit, Equifax, and Experian. Lenders look at your credit score to decide if they want to offer you a credit card, mortgage, etc., and how much interest you should pay. The UK government can also access your credit score when deciding if you should receive benefits or when following up on unpaid taxes.

How to improve your credit score if you’re self-employed:

If you’re self-employed, a poor credit score can restrict your chances of getting a mortgage, compared to a regular employee.

What you should do:

• keep your accounts up to date, and use certified accountant for your Self Assessment tax return
• make sure that you save all tax returns, bank statements, and any other proof of income.
• you can also ask HMRC for your form called SA302: it shows your total income and tax due.