Sole Trader FAQs
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.
When is the tax I owe due to HMRC?
This is due by the same date as your Self Assessment, the 31st January following the tax year for which it owed. This is why it’s beneficial to file your Self Assessment early, allowing you to plan when to pay the tax you owe. You might also need to make payments on account. These are two payments ...
Claiming Travel Costs and food
Claiming Travel Costs Claiming for travel and food costs can be a bit of minefield so be smart and read on The general rule of thumb for sole traders is that you can claim if the travel occurred in the natural course of business. You can claim for travel expenses as long as that travel is wholly ...
Can I put my car / vehicle through my business?
The quick answer is yes, if you're travelling for business. There are two methods of using your vehicle for business. When you're a sole trader there's legally no difference between you and your business, so there’s no such thing as a ‘company car’. That being said you can still claim certain expen...
Should I change from Sole Trade to LTD?
Doing business as a limited company is beneficial for many small businesses, contractors and freelances. It involves a few more responsibilities than regular sole trading, but there is a smorgasbord of great potential benefits to going limited. Could it save you money? Yes you could. When...
Can I pay into a pension?
This can be done from personal funds. The lower limit for this is either your total gross salary or the sum of £2,880 (whichever is lower); while £40,000 is the maximum amount you can get tax relief on. This is a tax efficient way of investing money because you normally get tax relief. For more inf...
How do I pay myself?
In the sole trader world paying yourself is called ‘drawings’. You’ll do this by transferring money from your business account to a personal one.
Crunch Invoice is a Service offered by Crunch, whereby you can create and manage invoices to be sent to your customers. At this stage, the Service is only offered to sole traders or partnerships that are not VAT-registered. 1. The Contract 1.1 When you use the Crunch Invoice Service you enter ...