Sole Trader FAQs

How do I pay myself as a Crunch sole trader and how are my taxes calcu...

As a sole trader with Crunch, how do I pay myself from my business? As a sole trader, you’re not directly employed and do not receive a salary or wage in the traditional sense. You are paid based on ‘drawings’ from your business. You need to pay tax on these drawings. How do I record drawings...

Should I register for VAT?

VAT Registration Options In this article, we’ll help you decide whether you should register for VAT and what scheme is best for your business. What are my options? Most clients have three options: Don’t register for VAT Register on standard rate VAT Register on the VAT Flat Rate S...

How to keep your account healthy

You should log in on a monthly basis to keep your accounts up to date. Regular updates to your finances are key to ensuring that the advice we give you is correct and relevant. We’re here to help, so if there’s anything you’re not sure about just get in touch with your Client Manager. Top tips fo...

Bank reconciliation with FreeAgent

Bank reconciliation (also known as bank rec) is the process of ensuring that the transactions in your business account correlate to transactions recorded in your Freeagent account. In other words, it’s matching up your accounts so they contain the same information. Doing this is an absolute must if ...

How do I record expenses using Freeagent?

Every business will have expenses in the line of carrying out their work. If you claim on them, you can offset the amount of tax you have to pay come Self Assessment time. This sounds great but can often lead people to overclaim in order to lower their tax bill. The real trick is to be sensible an...

What are the main expenses I can claim as a Sole Trader?

Your business will naturally incur running costs. These can be deducted from profits provided they are allowable business expenses. This does not include money taken out of the business to pay for personal expenses. You can claim the majority of costs that are directly related to your business. For...

Do I need a separate bank account?

For the Crunch service, you must have a separate business bank account. This is designed to make it easier when recording business transactions. Although not a legal requirement, it will make your life a lot more straightforward. Trying to sift through potentially hundreds of transactions in your p...

What is a Self Assessment?

Self Assessment is HMRC’s method of collecting Income Tax and National Insurance from the self-employed. It is an online form where you declare your income to HMRC for a given tax year, so they can calculate how much tax you owe.

How much tax will I pay?

This will depend on your profits your business makes. For more information check out our tax rates page.

Do I have to complete a Self Assessment tax return?

If you have been a sole trader for any period of the tax year in question, you must complete a Self Assessment tax return to ensure you're paying the correct amount of personal tax, and getting the right personal allowances.
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