It is overt fact that starting your own business has plenty of benefits. That’s where sole proprietorship comes in which is the simplest business structure to establish. Being your own boss, you enjoy flexible working hours, make decisions of your own, receive all the business profit and implement strategies to grow your business. So by considering these rewards, if you want to work as a sole trader, you might be wondering how do I register as a sole trader?
Struggling to register as a sole trader? We’ll register your self-employed business in no time. Fill out this form now and avoid the hassle!
Let’s find out the answer in this short post!
What is a Sole Trader?
When you start your own business as a self-employed individual, you’re called a sole trader. You don’t need a lot of capital and you don’t need directors, shareholders and partners to share your liabilities to be a sole trader. Here, you have the sole authority to control and make key decisions for your business. In addition, you get all your profit.
Although a sole proprietorship is a simple and easy form of business structure with tons of benefits, however, it has some drawbacks too. Here you have unlimited liability means if there is a large debt you need to pay, you’re responsible to pay it even from your personal assets.
How Do I Register as a Sole Trader?
Sole traders don’t need to register their business at Companies House. However, you need to inform HMRC about your business for informing your income to HMRC and paying taxes on it. Here are some of the ways to register for sole tradership:
- You can register online by filling this online self-employed registration form
- Contact HMRC on 0300 200 3310 and let them know that you’re self-employed
- Register to HMRC online account. After registration, you’ll get a 10 digit UTR number and an activation code for your online account
- Register for the annual self-assessment tax returns via an online account
- Print the online form and fill it in, and send it to the address mentioned in the form
Due to the high demand, we now offer special packages for self-employed individuals. Just choose the services that you want!
What Details Do I Need to Provide to HMRC?
The general information you need to provide while registration as a sole trader is your:
- Postal address
- Contact number
- Business name
- NI number
- Nature of the work
- Starting date of the business
Contact Jobcentre Plus for getting an NI number, if you don’t have one.
When Do I Need to Register?
From the starting date of your business, you need to register sooner than later before 5th October in the second year of your business commencement. Let’s make it simple with an example.
Suppose you started your business as a freelancer between April 2020 to April 2021, then you need to register before 5th October 2021. You don’t need to worry if you register late as there’s no penalty for registering late after this date as long as you send your Self Assessment tax return and other tax bills on time.
You don’t need to pay any fees for registration. And it takes around 10 to 21 wording days from HMRC to complete the registration process
So you have got the answer to how do I register as a sole trader, what information is required for registration and when do you need to register. If you’ve just started out or are already stressed out planning for your new business, registering for the sole proprietorship can be daunting and troublesome for you.
For professional advice on the registration process, contact us right away!
Disclaimer: This blog provides general information on the registration process of a sole trader.