If you started working for yourself, then you need to register as self-employed with the HMRC.
The good news:
- the process is straightforward
- you only need to do it once
- it covers both income tax and National Insurance contributions (NIC).
First time registering as self-employed?
- Create a HMRC online account.
- You’ll receive a user ID.
- Log back into the HMRC onlie account, select “add a tax”, and then “Self Assessment”.
- Select “Sole Trader” from the options: individual, sole trader, partnership, or trust.
- Enter the date you started your self-employment.
- Submit more details, including your National Insurance Number (here’s how to get one).
- Describe the work you do: “security guard”, “Uber driver”, “freelance designer”, etc.
- Review and click “submit”.
- You’ll get a letter with your Unique Taxpayer Reference (UTR) number by post.
- You’ll also receive another letter within 10 working days with an activation code. You’ll need this code to activate your UTR.
You can also do this using the SA1 form: you can download it on HMRC’s website, fill it in, and send it by post. We don’t recommend it, however – it will take additional time to reach the HMRC.
If you’ve sent a tax return before
The process is similar, but instead you will use the online CWF1 form.
Just use the same UTR number and HMRC login as last time.
If you work in the construction industry (CIS)
HMRC treats subcontractors working in construction (builders, painters, carpenters, etc.) differently.
Let HMRC know if you’re a construction worker and register for the Construction Industry Scheme (CIS).
After you’ve registered
- Keep track of your invoices and receipts.
- File your Self Assessment tax return by January 31st every year
- Make payments to HMRC twice a year: on January 31st and July 31st
- Pay National Insurance Contributions (NICs)
- Register for VAT if you’re making £85,000 from self-employment.
For more details, check out our list of frequently asked questions and answers for self-employed registering for Self Assessment.
You might also want to understand how Payment on Account works — your first tax payment will be 50% larger than you expect.
When you will want to stop being self-employed
You will need to tell HMRC – here is how you do it. HMRC will still expect you to file a tax return otherwise.
HMRC will still expect you to file a tax return otherwise.