for Sole Traders from Beach Accountants
Accountants offer the following services for the Sole Trader:
Running a business, as a Sole Trader can be an exciting opportunity and
is the simplest way to start trading. There is important information that
you need to be aware of when starting up in business as a Sole Trader
Registration and Responsibilities
- Within 3 months of starting to trade, you must inform the HMRC. This can be done using the CWF1 form, by telephone
or on their website. If you don’t advise the HMRC within this
time limit you are subject to a Penalty.
- It is a legal requirement that you should maintain good book keeping
records and keep the records for six full tax years. A penalty can be
imposed by HMRC if you do not keep adequate records.
- It is advisable to check for any grants or financial assistance for
start-ups or expanding businesses.
- When you start trading as a Sole Trader, you use your own money and
assets, so be careful in that you are also liable for any debts your
Accounting Requirements and Deadlines.
- You must produce an annual Report and Accounts
- You have to submit an annual Self Assessment Tax Return to HMRC
- The submission deadline for your Self Assessment Tax Return, which
incorporates your Report and Accounts, is 31 January.
Tax and National Insurance Contributions
- Your profits are taxed under Income Tax rules, has various rates depending
on the profits. This Tax is paid at the end of January and July.
- Self-Assessment has two rates of National Insurance Contributions.
Class 2 is a fixed rate and is payable monthly by Direct Debit. Class
4 is a variable rate depending on your profits and is paid with your
Income Tax in January and July.
- Failure to submit a Self Assessment Tax Return on time will automatically
create a penalty and interest will be due on your tax liability.
- See resources for information on rates.
For further information or advice contact