How to register as self-employed

If you’re starting to work for yourself — as a tradesperson, taxi driver, courier, freelancer, or any other self-employed role — you need to register with HMRC. It’s a straightforward process, but there are deadlines to meet and ongoing responsibilities to understand. Here’s a clear guide to getting it done.

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Public liability insurance

Many self-employed people need public liability insurance as part of their business setup. Get a public liability insurance quote from insurd in minutes.

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Do you need to register?

If your self-employed income exceeds £1,000 in a tax year, you must register with HMRC as self-employed. This applies even if you also have a full-time job — the threshold refers to your self-employed income only, not your total earnings.

Some people assume that working part-time or on a casual basis means they don’t need to register. If the £1,000 threshold is crossed, registration is required regardless of how occasional the work is.

When do you need to register?

You must register with HMRC by 5 October following the end of the tax year in which you started working for yourself. For example, if you started self-employed work during the 2025 to 2026 tax year, you must register by 5 October 2026.

Registering late can result in a penalty, so it’s best to register as soon as you start earning rather than waiting until the deadline.

How to register: step by step

1. Check whether you need to register — If your self-employed income is over £1,000 for the tax year, you need to register. If you’re under that threshold, you don’t have to — though you can register voluntarily if it suits your plans.
2. Gather what you need — Before you start, have the details of your business or trade (if applicable) and the following ready:
   1. Your National Insurance number
   2. Your personal details — name, address, date of birth
   3. The date you started self-employed work
3. Register on GOV.UK — Go to the GOV.UK self-employment registration page and register for Self Assessment. This creates your record with HMRC and generates your Unique Taxpayer Reference (UTR) number — a 10-digit number you’ll use for all tax correspondence.
4. Set up a Government Gateway account — This is your online account for managing your tax affairs with HMRC. You’ll use it to file returns, check what you owe, and track payments.
5. Wait for your UTR — Your UTR arrives by post within around 10 working days. Keep it safe — you’ll need it every time you file a tax return.

What happens after you register?

Once you’re registered, you’re responsible for:

• Filing a Self Assessment tax return every year by 31 January (for online returns)
• Making sure you pay income tax on your profits
• Paying Class 4 National Insurance contributions on your profits above the relevant threshold
• Keeping accurate records of all income and expenses throughout the year
• Registering for VAT if your taxable turnover exceeds £90,000

HMRC may also send payment on account reminders — advance payments towards your next tax bill. These can catch people out if they’re not budgeted for, so it’s worth understanding how they work from the start.

Tax obligations as a self-employed person

The main taxes that apply to self-employed income are:

Income tax — charged on your profits (income minus allowable expenses) above your personal allowance. The rate depends on how much you earn.

Class 4 National Insurance — charged at 9% on profits between £12,570 and £50,270, and 2% above that. Class 2 NICs were abolished for most self-employed people from April 2024, so you no longer pay the flat weekly Class 2 charge unless you choose to pay voluntarily to protect your State Pension entitlement.

VAT — if your turnover exceeds £90,000 in a 12-month period, you must register for VAT and charge it on your sales.

If you’re a taxi or private hire driver, it’s also worth being aware of the Making Tax Digital changes that are being rolled out for self-employed people. You can read more in our guide to what is the new HMRC law for taxi drivers.

Sole trader or limited company?

Most self-employed people register as sole traders, which is the simplest structure. You and the business are the same legal entity, which keeps admin straightforward.

A limited company is a separate legal entity, which means your personal finances are protected if the business runs into trouble. It can also be more tax-efficient at higher income levels, but comes with more administrative requirements — annual accounts, Companies House filings, and more complex tax returns.

If you’re unsure which structure is right for your situation, an accountant can help you compare the options before you commit.

Claiming expenses

One of the practical benefits of self-employment is that you can deduct allowable business expenses from your income before calculating your tax bill. Common examples include:

• Travel costs — fuel, mileage, public transport for business journeys.
• Vehicle costs — if you use a vehicle for work, you can claim either a mileage allowance or a proportion of the actual running costs.
• Equipment and tools
• Marketing and website costs
• Home office costs — if you work from home regularly.
• Professional fees — accountant fees, for example, are themselves a claimable expense.

Keep receipts and records for everything you claim. HMRC can ask to see them.

Common mistakes to avoid

Missing the registration deadline — register by 5 October after your first tax year, not at the end of it.

Not keeping records — you need records of all income and expenses. Missing receipts can mean missed deductions.

Forgetting to budget for tax — your tax bill arrives after the money has already been earned. Set aside a percentage of every payment as you go rather than trying to find it all at once.

Underestimating the payment on account system — your second year’s tax bill often includes an advance payment towards the following year. This can feel like a double bill if you’re not prepared for it.

Insurance worth thinking about

Starting as self-employed often means taking on risk that an employer used to carry for you. A few types of insurance are worth considering early on.

Public liability insurance is essential for most self-employed people who work with clients or the public. If someone is injured or their property is damaged as a result of your work, it covers the legal and compensation costs. Some clients require proof of it before they’ll work with you.

Van insurance — if you use a van for work, you’ll need a business van insurance policy rather than a personal one. Read more in our guide to do I need business or personal van insurance.

Taxi or private hire insurance — if you’re registering as self-employed to work as a taxi or PHV driver, you’ll need the right class of cover from day one. Read more in our guide to what is hire and reward insurance.

Get a public liability insurance quote from insurd — we also arrange van, taxi, motor trade, fleet and other business insurance for self-employed people across the UK.

Ready to register?

Registering as self-employed is straightforward once you know the steps. The key is to do it promptly, keep good records from the start, and make sure you understand what taxes you’ll owe and when. Getting those habits in place early makes everything that follows much easier to manage.

Frequently asked questions