28/05/2026
Sole trader, self-employed and freelancer, you've probably heard all three and wondered if they actually mean the same thing. (Mostly yes, by the way.)
Here's what being a sole trader actually means for your tax situation:
✅ You register with HMRC and do a self-assessment return each year by 31 Jan
✅ Your profits are yours, but you pay income tax on everything above your personal allowance of £12,570
✅ It's simple, low-admin, and perfect for getting started
⚠️ You are personally liable for any business debts. There's no legal separation between you and the business
For a lot of people starting out, a sole trader is absolutely the right call. But if your profits are growing, it might be worth a conversation about incorporating a limited company.
Not sure where you sit? Just ask, we're happy to talk it through 😊