How to register as a sole trader with HMRC

When you need to register

You must register for Self Assessment if you earn more than £1,000 in a tax year from self-employment (the 'trading allowance'). The tax year runs from 6 April to 5 April. You should register by 5 October after the end of the tax year in which you started — so if you began caring work in June 2026, register by 5 October 2027. Registering sooner is better.

What you'll need before you start

Have these ready before you sit down to register:

• Your National Insurance number
• Your full name, date of birth and home address
• The date you started (or will start) self-employed work
• A description of your work — 'care services' or 'domiciliary care' is fine
• An email address and phone number

How to register, step by step

The whole process is done on the GOV.UK website:

• Go to GOV.UK and search for 'register for Self Assessment'
• Sign in with (or create) a Government Gateway account
• Choose 'sole trader' as your business type and enter your details
• HMRC will post your Unique Taxpayer Reference (UTR) — a 10-digit number — usually within 10 working days
• Once you have your UTR, activate the Self Assessment service in your online account

What happens after you register

Every year you'll file a Self Assessment tax return, due by 31 January following the end of the tax year (for online returns). You pay income tax and Class 4 National Insurance on your profits — that's your income minus your allowable expenses. If your bill is over £1,000, HMRC will usually ask for payments on account towards the next year too.

Records you must keep

HMRC expects you to keep records of:

• All income — invoices you've sent and payments received
• Business expenses with receipts: mileage, training, insurance, DBS fees, PPE, phone costs
• Mileage logs if you claim business mileage (45p per mile for the first 10,000 miles)
• Bank statements, ideally from a separate account you use for your care work

Common mistakes to avoid

The things that catch new sole traders out most often:

• Missing the 31 January filing deadline — there's an automatic £100 penalty
• Not putting money aside for tax — 20–25% of what you earn is a sensible habit
• Claiming personal costs as business expenses — only claim what's wholly for your work
• Assuming being paid in cash means it doesn't count — all income must be declared

Making Tax Digital is coming

From April 2026, sole traders with income over £50,000 must keep digital records and send quarterly updates to HMRC under Making Tax Digital for Income Tax. The threshold drops to £30,000 in April 2027 and £20,000 in April 2028. Most carers won't be affected immediately, but it's worth knowing it's on the way.