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Sole Trader

Term

Legal term for self employed in the UK.

Sole traders should be registered with HMRC before 5th October and find out their UTR numbers. They should maintain a separate business account to record income and expenses as well as submit a self assessment every year. Note: you may have to pay your tax bill using Payment on Account.

HMRC will not consider limited company directors self-employed. Limited companies are considered separate entities, whereas if you’re a sole trader, you’ll be considered as one with your business.

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