You can start trading as a sole trader before registering with HMRC. Registration means telling HMRC you are self-employed for tax purposes, not forming a limited company. You do not register a sole-trader business at Companies House, and having a PAYE job does not prevent you from trading independently.
Check whether you need to register
You normally need to register when your total trading income exceeds £1,000 in a tax year. Count income before deducting expenses, across your trading activities, rather than looking at profit.
For example, £1,400 received from customers less £600 in expenses leaves £800 profit. Your receipts still exceed the registration threshold. The £1,000 test is not the same as the personal allowance.
Choosing the best MTD software is a separate task, not a prerequisite for registering. Making Tax Digital deals with digital records and reporting for those covered by its rules.
Below that threshold, registration can still be needed for particular reasons, such as proving self-employment or paying voluntary National Insurance contributions. Check HMRC’s guidance for your circumstances.
Work out your registration deadline
The UK tax year runs from 6 April to 5 April. If you need to register for Self Assessment for the first time, tell HMRC by 5 October following the end of the relevant tax year.
For example, if your trading income exceeds the threshold during 6 April 2025 to 5 April 2026, your notification deadline is 5 October 2026.
That is not your filing deadline. The usual online return deadline for 2025/26 is 31 January 2027.
Prepare your details and follow the right HMRC route
Start at the official GOV.UK sole-trader registration page. Its questions direct you to the route appropriate to your circumstances.
Before opening the application, gather:
-
Your National Insurance number.
-
Your full name, address and contact details.
-
The date you started trading.
-
Your business name, address and description of the work.
-
Your existing Unique Taxpayer Reference (UTR), if you have one.
You can trade under your own name or a business name; having a trading name does not create a separate company.
If you are new to Self Assessment, follow the registration instructions, signing in or creating sign-in details when prompted. Check the business start date carefully and review your answers before submitting.
If you already complete Self Assessment, perhaps because of rental income, you must still tell HMRC about becoming a sole trader. Follow the route for existing taxpayers and use your existing UTR. If you cannot find it, use HMRC’s retrieval guidance rather than starting a duplicate registration.
If you previously registered but stopped filing, follow HMRC’s reactivation instructions. Having an old UTR does not establish that your Self Assessment record is active.
Know what happens after registration
Save your submission confirmation and any reference numbers. If you are new to Self Assessment, HMRC will issue your ten-digit UTR. Keep it secure: it identifies your Self Assessment record and is different from your National Insurance number.
Registration does not submit a return or settle a tax bill. Record income and expenses from the start of trading, keeping invoices and receipts alongside the figures. Note the filing deadline and check your HMRC account for any further instructions.