Guides and planning notes
Sole trader guides
Each guide answers one practical question about being self-employed in the UK, with the 2026/27 figures, worked examples and links to the GOV.UK pages they rely on. They are grouped below by what you are trying to do. If you want a number rather than an explanation, the calculators on this site use the same rates.
Your tax bill and how it is worked out
How Income Tax and Class 4 National Insurance apply to profit in 2026/27, what changes in Scotland and Wales, what the 28 October 2026 Budget means for sole traders, and how you take money out of the business.
Sole trader tax rates 2026/27
The 2026/27 Income Tax and Class 4 National Insurance rates and thresholds sole traders pay, plus Scottish bands and worked examples at common profit levels.
How to Work Out Your Self-Employed Profit: From Turnover to Taxable Profit (2026/27)
The formula sole traders use: turnover minus allowable expenses gives net profit; add back anything disallowable for taxable profit; take off Income Tax and Class 4 for profit after tax. With a worked example.
Budget 2026 for Sole Traders: Trading Allowance £3,000 and What Else Changes
Budget 2026 for the self-employed: trading allowance and reporting limit £1,000 to £3,000 from April 2027, Class 4 NI unchanged, 35p mileage above 10,000 miles, 12% writing-down allowance, MTD penalty easement for 2027 joiners.
Sole Trader Tax in Scotland 2026/27
How Scottish income tax rates affect sole trader take-home profit, with worked examples comparing Scotland and rUK at different profit levels.
Sole Trader Tax in Wales 2026/27
Wales uses the same rUK income tax rates as England for 2026/27. This guide confirms how sole trader tax is calculated in Wales and what, if anything, differs from England.
Sole Trader Earning Under £12,570: Tax Return, NI and State Pension
Self-employed with profit under the £12,570 Personal Allowance? You must still file if income is over £1,000. 2026/27 tax, Class 2 NI credits and State Pension, explained.
How Do Sole Traders Pay Themselves? Drawings, Not a Salary (2026/27)
Sole traders take drawings, not a salary. Drawings are not an expense and do not change your tax: you pay on profit. Worked £40,000 example for 2026/27.
Pension Tax Relief for Sole Traders 2026/27: How It Works and What It Saves
How a self-employed pension contribution gets tax relief: 20% added by the provider, more through Self Assessment for higher-rate profit, and up to 60% between £100,000 and £125,140. Class 4 is unchanged.
Self Assessment: filing, deadlines and penalties
The 31 January 2027 deadline for 2025/26 returns, which self-employment pages to fill in, what happens if you register, file or pay late, and the options if you cannot pay in full.
Your 2025/26 Self Assessment Tax Return: What to File and Pay by 31 January 2027
The return due 31 January 2027 is for 2025/26 (6 April 2025 to 5 April 2026). The dates, the 2025/26 figures that differ from 2026/27, and two worked January bills.
Self Assessment Deadlines for Sole Traders: 31 January 2027
File your 2025/26 return online and pay by 11:59pm on 31 January 2027. The paper, tax-code, registration and payment on account dates, and what each missed deadline costs.
Your First Self Assessment Tax Return as a Sole Trader
Started trading in 2026/27? Register by 5 October 2027, file online by 31 January 2028 and pay the bill plus your first payment on account. Worked £30,000 example.
Self Assessment for Sole Traders: Deadlines, Penalties and Tips
A practical guide to completing Self Assessment as a sole trader, covering registration, key deadlines, what to include, and how to avoid late filing penalties.
SA103S or SA103F? The Self-Employment Pages of Your Tax Return
Which self-employment pages to use (short SA103S below the £90,000 VAT threshold, full SA103F above), what figures you need, expenses or the £1,000 allowance, with examples.
Missed the 5 October Self Assessment Deadline? What Happens Now
Missed 5 October 2026? Register now. HMRC gives you 3 months from its letter to file, the tax is still due 31 January 2027, and paying it all by then avoids the failure to notify penalty.
How to Appeal a Self Assessment Penalty: Late Filing or Payment
You usually have 30 days to appeal a Self Assessment penalty. What counts as a reasonable excuse on GOV.UK, how to appeal online or by post, and why you may want to pay first.
Can't Pay Your Self Assessment Bill by 31 January? Payment Plans, Penalties and Interest
File on time even if you can't pay. Set up an HMRC payment plan online if you owe £30,000 or less, avoid the 5% penalty by agreeing it within 30 days, and what interest costs.
Pay Self Assessment Through Your Tax Code (File by 30 December)
Have a job and a side business? File your 2025/26 return online by 30 December 2026 and a bill under £3,000 can be collected through your tax code over 12 months.
Payments on account and setting money aside
Why the first January bill can be 150% of a year's tax, when payments on account apply, how to reduce them, and how much to put aside each month so the bill is covered.
Payments on Account 2026/27: Dates, 150% First Bill, SA303
Payments on account are two 50% advances due 31 January and 31 July. Why the first January bill is 150%, the £1,000 and 80% exemptions, and reducing them with SA303.
How Much Tax to Set Aside as a Sole Trader (Monthly Guide)
A practical approach to calculating your monthly tax set-aside as a sole trader, so you are never surprised by a January payment.
Expenses and allowances
What you can deduct before tax is worked out: the wholly and exclusively test, flat-rate simplified expenses, home working, travel, training, vans and equipment, and when the £1,000 trading allowance is the better choice.
Sole Trader Expenses 2026/27: What You Can Claim and What It Saves
What sole traders can claim in 2026/27: the wholly-and-exclusively test, 55p mileage, home working, equipment. Each £1 claimed saves about 26p at basic rate.
Sole Trader Allowable Expenses — Full List 2026/27
A comprehensive guide to what sole traders can and cannot claim as allowable expenses in 2026/27, covering the 'wholly and exclusively' test, home working, mileage, equipment and professional costs.
Simplified Expenses for Sole Traders: 2025/26 and 2026/27 Rates
HMRC's simplified expenses flat rates in one place: 45p a mile for 2025/26 and 55p for 2026/27, £10 to £26 a month for home working, and the living-at-your-premises rates.
Working From Home as a Sole Trader: Flat Rate or Actual Costs? (2026/27)
Claim use of home as a sole trader: HMRC's £10, £18 or £26 a month flat rate, or a share of actual bills. Side-by-side worked example, broadband, and the CGT trap.
Sole Trader Travel Expenses 2026/27: Journeys, Mileage and Meals
Which journeys a sole trader can claim, the 55p mileage rate for 2026/27, why commuting and everyday lunches are out, and when meals and hotels count. Worked example.
Can Sole Traders Claim Training Courses and Conferences? (2026/27)
HMRC's rules on training costs for sole traders: what counts (updating skills, new tech, admin skills), what doesn't (a new trade), with HMRC's own examples and the tax saved.
Sole Trader Van, Car and Equipment Tax Relief 2026/27
How a sole trader gets tax relief on a van, car, tools or a laptop in 2026/27: cash basis, the £1m Annual Investment Allowance, the 14% and 6% pools, the new 40% first-year allowance and when the 55p mileage rate is better.
Trading Allowance 2026/27: The £1,000 Rule and How to Claim
The £1,000 trading allowance lets you earn up to £1,000 from self-employment without paying tax or filing a return. This guide explains when it applies, how to choose between the allowance and actual expenses, and how to claim it on Self Assessment.
Making Tax Digital and record keeping
Who has had to use Making Tax Digital for Income Tax since April 2026, the quarterly update dates, and the records that make both the updates and the tax return straightforward.
Making Tax Digital for sole traders
What Making Tax Digital for Income Tax means in practice, who it affects, income thresholds, digital record requirements and how to prepare.
MTD Quarterly Updates 2026/27: Deadlines and How to File
How to send a Making Tax Digital quarterly update: 2026/27 deadlines (next one 7 November 2026), what goes in, how to fix mistakes, and the first-year penalty points rule.
Bookkeeping for sole traders: practical basics
What records sole traders must keep, how to build a monthly bookkeeping habit and why clean records improve pricing and tax estimates.
Starting out and choosing a structure
Registering with HMRC, side income alongside a job, the Construction Industry Scheme, and how a sole trader compares with a partnership, a limited company or a PAYE job.
Register as a Sole Trader with HMRC: Deadline and Steps (2026/27)
How and when to register as a sole trader with HMRC, what the £1,000 trading allowance means for your registration deadline, and what to expect after you register.
Tax on side hustle income: a practical guide
How self-employed side income is taxed, the trading allowance, when to register, how employment income affects the calculation, and what to set aside.
Construction Industry Scheme (CIS) for Sole Traders
How CIS works for sole trader subcontractors, how tax deducted at source is reclaimed through Self Assessment, how to register, and what records to keep.
Sole trader vs limited company: a practical comparison
How sole trader and limited company tax differs, when incorporation may be worth considering, and how to run an honest comparison using the same profit assumption on both sites.
Sole Trader vs Partnership — Tax Comparison
How a business partnership compares to sole trader status for UK tax purposes, including profit-sharing rules, registration, joint liability, and when either structure makes sense.
Sole Trader vs PAYE Employment: Full Tax Comparison 2026/27
A thorough comparison of sole trader and PAYE employment tax treatment, covering income tax, National Insurance, expenses, pension, and net income at equivalent gross amounts.