Going self-employed in a trade: your first 90 days of admin

To go self-employed in a trade you need to register with HMRC for Self Assessment, keep records of what you earn and spend, and set your prices so they cover tax, insurance and quiet weeks. Do those three properly in the first few months and the rest is habit. This guide runs through it in the order it tends to come up. It is general guidance; your accountant can advise on your own situation.

What do you need when becoming a self employed tradesman?

The short list: an HMRC registration, a separate bank account, the right insurance, a price you have actually worked out, and a way of keeping records as you go. Add a simple quote and invoice that look professional, and you are ready to take work. Everything below is about doing each of those without it eating your evenings.

Register with HMRC early

You register for Self Assessment as a sole trader on GOV.UK. The deadline is 5 October after the end of the tax year you started in (tax years run 6 April to 5 April), but there is no reason to wait. Register once you start trading and you will get your Unique Taxpayer Reference in good time. If you do construction work for contractors, register for CIS as a subcontractor too, or contractors must deduct at the higher 30% rate. See the CIS guide.

Separate your money and insure yourself

As a sole trader you are not legally required to have a business bank account, but keeping work money apart from personal money makes your records far simpler and your accountant’s bill smaller. Public liability insurance is not compulsory either, but most customers and every main contractor will expect it. Employers’ liability insurance becomes a legal requirement once you employ anyone.

Work out a price, do not guess one

New tradies often price against what they earned as an employee and forget holidays, van costs, tools, insurance and tax. Work backwards from the year: what you need to take home, plus costs, divided by the days you will really bill. The hourly rate calculator does the sums, and our guide on pricing a job covers the rest.

Keep records from day one

HMRC expects records of income and expenses, kept for at least five years after the 31 January filing deadline for that tax year. Make it a habit to capture each one as it happens. Photograph receipts, log mileage on the day, and keep a copy of every invoice. If your qualifying income goes above £50,000, Making Tax Digital for Income Tax means keeping those records digitally and sending quarterly updates; the threshold drops to £30,000 from April 2027. Our guide to what records to keep has the full list.

Set up admin you will actually use

The best system is the one you use from the van. With GraftG you text WhatsApp to log a receipt, record mileage, send a quote or invoice a finished job, and it is all kept ready for your tax return. Solo is £14 a month with a 14-day free trial (a card is taken at checkout). Getting started takes a few minutes.

FAQ

When do I need to register as self-employed?

You must register for Self Assessment by 5 October after the end of the tax year in which you started trading. Most people register as soon as they start, so they are not caught out.

Do I need public liability insurance as a self-employed tradesman?

It is not a legal requirement for sole traders, but most customers and contractors expect it and many will not use you without it. Employers’ liability insurance is compulsory once you employ someone.

Do I need a business bank account as a sole trader?

No, it is not a legal requirement for sole traders, but a separate account keeps work and personal money apart, which makes your records and your tax return much simpler.

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