To complete your first tax return after becoming self-employed, you may need to register for Self Assessment. You need to collect your income and expense information and submit it to HMRC. Any tax due must also be paid. When filing early, you have time to fill in missing information and get a clear understanding of your bill, especially if you have employment income in addition to your new business.
A Self Assessment return is normally required if, from self-employment, you earn more than £1,000 in gross trading income in a tax year, before deducting expenses.
This threshold is not about profit, but trading income. For example, your income might be £3,000, whilst your expenses are £2,500 and are almost entirely business-related.
There are other situations where a return may be necessary. Do not ignore a request by HMRC to file if you believe no tax is due. If you think the notice should be withdrawn, contact HMRC and ask whether it can be cancelled.
The tax year in the UK runs from 6 April to 5 April. Your first return normally covers the tax year in which you started trading and includes other reportable income.
Register through HMRC's Self Assessment process and arrange access to the relevant online service before you need to submit your return.
You'll need your Unique Taxpayer Reference (UTR). It is different from your National Insurance number. If you already have a UTR, determine whether you need to update or reactivate your account.
If you have been trading since the 2025/26 tax year, the following dates are typical:
Do not delay if you missed the deadline for registration. Contact HMRC to understand the next steps, as late registration does not necessarily delay the payment deadline. Review the official Self Assessment deadlines to determine which dates apply to you.
Collect evidence of business income, allowable business expenses and other reportable income before completing your return. Full records make it easier to check your figures and submit accurate information.
Start by gathering the following documents and information:
Read payment platform fees carefully. The balance shown on your bank statement may be less than the amount paid by the customer because transaction charges have been deducted.
Self Assessment support can help you identify the questions you need to answer and the information you should gather before filing.
Allowable expenses reduce your taxable business profit. Examples may include business insurance, relevant software and eligible office expenses, subject to HMRC's rules.
If an expense has both personal and business uses, claim only the portion that relates to your business. Keep a record of how you calculated the business proportion.
You may be able to use the £1,000 trading allowance instead of deducting actual business expenses if you are eligible. You generally cannot claim the trading allowance and deduct actual expenses against the same trading income. Compare your options before deciding which approach is more suitable.
For example, £8,000 of income minus £2,000 of allowable expenses gives a business profit of £6,000 before any other adjustments. This is not your final tax bill, as other income, allowances and National Insurance contributions may affect the amount payable.
Complete all relevant sections, review the calculation and submit your return to HMRC. Then use the appropriate HMRC reference and payment method to arrange payment of any tax due.
Confirm your accounting method first. The cash basis generally records income when money is received and expenses when money is paid. Traditional accounting generally records income when it is earned and expenses when they are incurred, even if payment happens later. Apply the relevant method consistently when entering your figures.
Before submission, check the following:
Keep the confirmation of submission and a copy of your return. Check whether your saved draft was actually submitted rather than assuming that saving it completed the process.
Your January tax payment may include the balance due for the previous tax year and an advance payment towards the following year's tax bill. These advance payments are known as payments on account.
Payments on account generally apply when the previous year's Self Assessment tax bill was at least £1,000 and less than 80% of the tax owed was collected at source, subject to HMRC's rules. Before budgeting, read HMRC's guidance on payments on account.
You should also check whether Making Tax Digital for Income Tax applies to you. Some sole traders must use compatible software and submit quarterly updates, so an annual tax return alone may not meet all their obligations.
These answers address some frequently asked questions about small profits, employment income and what happens after submission.
Possibly. The £1,000 threshold for self-employment reporting is generally based on gross trading income, not profit. Therefore, a return might be needed even if there is little or no Income Tax to pay. You should also consider other income and circumstances rather than relying only on your estimated tax bill.
You can be self-employed and employed during the same tax year. Your employment income and tax deducted should be reported in the relevant sections of your return alongside your business figures. Use your actual employment records rather than estimates, and remember that employment earnings can affect the tax due on your overall income.
Filing early does not normally change the standard tax payment deadline. However, check the dates and payment requirements that apply to your circumstances, including any payments on account. Early filing helps you calculate the amount you may need to pay and plan your finances before the deadline.
Yes. An accountant or tax adviser can help organise your records, check the figures and complete your return. Understand what is included in the service and agree on the responsibilities involved. You remain responsible for ensuring that the information submitted is accurate, so review the return and ask questions before authorising its submission.
Self Assessment Help can assist you with questions about filing your first tax return, the information you need to prepare and the steps involved in reporting your self-employed income. Our aim is to help you understand your obligations and approach your first tax return with greater confidence.