How to register as a sole trader in the UK
Set up as a sole trader in the UK with a business name, HMRC registration, records, tax checks and the right insurance.
In one sentence
To set up as a sole trader, choose a business name, register with HMRC for Self Assessment as self-employed, keep records and check your tax, insurance and licence requirements.
Quick answer
- Register with HMRC for free online if your self-employed income exceeds £1,000 in a tax year.
- Register by 5 October after the end of the tax year you started trading.
- You do not register a sole trader business name with Companies House.
- Keep income and expense records and check VAT, Making Tax Digital, insurance and licences.
Steps
- 1Choose your business name.
- 2Register with HMRC for Self Assessment as self-employed.
- 3Get your UTR.
- 4Set up your records.
- 5Check other taxes.
- 6Check insurance and licences.
What is a sole trader?
You run the business as yourself. You keep the profits after tax and are personally responsible for the business's debts. You do not register with Companies House.
You can be employed and run a sole trader business at the same time. For a comparison of business structures, read Sole trader vs limited company.
How to register as a sole trader: step by step
1. Choose your business name
Use your own name or choose a trading name. Check the naming rules below before ordering signs, buying a domain or printing invoices.
2. Register with HMRC for Self Assessment as self-employed
Registration is free and you can do it online on GOV.UK. You need your National Insurance number. If you do not have it to hand, find your National Insurance number before you start.
3. Get your UTR
HMRC posts your Unique Taxpayer Reference (UTR), usually within about 10 working days. Once your online account is ready, you can file your tax return online. If you already have a UTR, tell HMRC about your self-employment rather than applying for a second one.
4. Set up your records
Record income and expenses from your first day of trading. Keep invoices, receipts and bank statements. A separate bank account makes it easier to track business money, but it is not a legal requirement for sole traders.
5. Check other taxes
Check VAT registration if your taxable turnover goes over £90,000 in a rolling 12-month period, or you expect it to go over £90,000 in the next 30 days alone. Read the VAT registration threshold guide. Check whether Making Tax Digital for Income Tax applies to you too.
6. Check insurance and licences
Consider public liability insurance if you work with customers or the public. You usually need employers' liability insurance if you take on staff. Check any trade licences or permissions your work needs before you begin.
For the HMRC forms and online registration process, read Step-by-step: how to register for Self Assessment.
When do you need to register as self-employed?
Register if your self-employed income is more than £1,000 in a tax year, before deducting expenses. The tax year runs from 6 April to 5 April. The £1,000 trading allowance generally covers income below that amount, though you may still need to register for other reasons, such as claiming a loss.
The deadline is 5 October after the end of the tax year in which you started. For example, if you start trading in June 2026, that falls in the 2026/27 tax year. It ends on 5 April 2027, so register by 5 October 2027.
You can register earlier. Registering late can mean a penalty, so keep a note of your first trading date and check the deadline as soon as you start.
Do you need to register a business name as a sole trader?
No. Sole traders do not register a business name with Companies House. You can trade under your own name or a separate trading name.
Your name cannot include "limited", "Ltd", "LLP" or "plc". It must not be offensive. Some sensitive words need permission, and it cannot be the same as an existing trade mark.
If you use a trading name, put your own name and business address on invoices and letters too. Registering a trade mark is optional and separate from registering with HMRC.
Does it cost anything to register as a sole trader?
Registering with HMRC is free. There is no Companies House registration fee because you are not forming a company. You may have separate costs for insurance, licences or bookkeeping software.
Tax and Making Tax Digital for sole traders
You pay Income Tax on your taxable profit, after any allowances and reliefs. Profit is your business income less allowable expenses. Set money aside as you earn it so you can pay your Self Assessment bill.
For 2026/27, Class 4 National Insurance is 6% on profits between £12,570 and £50,270, then 2% on profits above £50,270. Class 2 is no longer compulsory. Voluntary Class 2 contributions may help protect your National Insurance record if your profits are low.
Making Tax Digital for Income Tax applies from 6 April 2026 if your qualifying income is over £50,000. The threshold falls to over £30,000 from April 2027 and over £20,000 from April 2028. Qualifying income means gross income from self-employment and property combined, before expenses, rather than profit. Your start date depends on the relevant earlier tax return, and exemptions can apply.
You will need compatible software to keep digital records and send quarterly updates if the rules apply. Read Making Tax Digital for sole traders or estimate your bill with our self-employed tax calculator.
Sole trader vs limited company: registration at a glance
| Registration detail | Sole trader | Limited company |
|---|---|---|
| Register with | HMRC (Self Assessment) | Companies House, then HMRC for Corporation Tax |
| Cost to register | Free | £100 online at Companies House |
| Business name | No registration | Registered and protected at Companies House |
| Personal liability for debts | Yes | Usually limited to the company |
Companies House name registration is separate from trade mark protection. Personal guarantees can also make a director personally responsible for a company debt.
Setting up as a sole trader?
Book a 30-minute call. We register you with HMRC, set up your records and handle your Self Assessment from the first year.
Book a call →Frequently asked questions
When do you need to register as self-employed?
Register if your self-employed income is more than £1,000 in a tax year, before expenses. The deadline is 5 October after the end of the tax year you started trading. If you start in June 2026, register by 5 October 2027.
Do you need to register a business name as a sole trader?
No, sole traders do not register a name with Companies House. You can use your own name or a trading name that follows the naming rules. Include your own name and business address on invoices and letters if you use a trading name.
Does it cost anything to register as a sole trader?
Registering with HMRC is free. Insurance, licences and bookkeeping software can have separate costs.
Do sole traders need Making Tax Digital for Income Tax?
It applies from 6 April 2026 for qualifying income over £50,000, from April 2027 for over £30,000 and from April 2028 for over £20,000. Qualifying income is combined gross self-employment and property income before expenses, not profit. Your start date depends on the relevant earlier tax return, and exemptions can apply.
How does sole trader registration differ from a limited company?
Sole traders register with HMRC for Self Assessment for free and are personally responsible for business debts. A limited company registers at Companies House for £100 online and with HMRC for Corporation Tax. Liability is usually limited to the company.
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