[səʊl ˈtreɪdə]
Sole Trader is the legal term used by HMRC for people earning self-employed income in the UK. They must file a Self Assessment to deal with tax obligations.
A Sole Trader is an individual who runs their own business as a Self-employed person in the UK. They are solely responsible for the management and financial obligations of their business.
A Sole Trader has a tax-free allowance of £1000 per year called the Trading Allowance. If they earn more than this allowance, the individual must register as a Sole Trader with HMRC by 5th October, keep records of income and expenses, and file a Self Assessment at the end of a Tax Year.
They can be liable for mistakes made by the company and have to pay business debts with their personal funds if needs be.
There are loads of different tax laws in the United Kingdom. IR35 is very important to freelancers and contractors but can be a little confusing. Here, we explain simply what IR35 is and who it can affect.
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Self-employed individuals can use two different methods to expense business vehicle costs. Here, we investigate the positive and negatives for both methods and which one might be right for you.
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