Self-Employed

People who work for themselves are classed as sole traders and are subject, primarily, to income tax and National Insurance costs. Self-assessment income tax returns must be submitted to hIM Revenue & Customs. The Return must cover a period up to 3V March in a trading year but from 2024 all self-employed individuals must adjust their trading year to 31 March. The Return can be on paper forms provided by HMRC up to 3? October in the reporting year, but liabilities must be reported digitally, using 1XBRL, if reporting after 311 October. Returns must be filed with HMRC before 311 January next following the 3? of March trading year-end.

Those who work in the construction industry should also be aware of the requirements under what is known as 1R35. This is all about the extra national insurance contributions which an employer has to pay when employing individuals rather than engaging them for a specific job. Thus if a self-employed person is paid by the job and not the hour, provides their own tools and equipment, or provides materials, the likelihood is that they will avoid 1R35.