Self-employed Sole Traders
Expert Accountancy Solution for Sole-Traders. We Show You How to Do It.
In the UK, if you are self-employed and running your own business independently then you are a self-employed sole trader. To run your business legally, you will first have to register your business with HM Revenue & Customs. HMRC allows sole traders to keep their profits after they have paid their tax on their income. However, if there is a loss in business then it is the responsibility of the individual to bear the loss, this can be offset against other income or future profits.
Reasons to register as a Sole Trader
- Your income is £1,000 or above within the tax year April to April
- Proof of income as self-employed, as an example to apply for finance or tax credits and other applications
- You can make voluntary payments for Class 2 National Insurance to be eligible for state benefits such as Pension.
- Maintain records of your business’s sales and expenses
- Submit Self-Assessment tax return every tax year
- You will have to pay income tax on the profits you earn from your business
- You will also have to contribute for Class 2 and Class 4 National Insurance
- ‘limited’, ‘Ltd’, ‘limited liability partnership’, ‘LLP’, ‘public limited company’ or ‘plc’
- be offensive
- be the same as an existing trademark