Are you a sole trader experiencing the complexities of self-assessment for the first time? This beginner’s guide to self-assessment will equip you with essential knowledge on registering, necessary documentation, and helpful software to streamline the process. Moreover, we will spotlight important deadlines and help you decide whether hiring an accountant is in your best interest.
What is Self-Assessment?
Self-assessment is the official method used in the UK to calculate your tax liability based on your annual earnings. Understanding this process is vital for ensuring compliance and optimizing your tax obligations.
Do You Need to Do Self-Assessment?
You are required to complete a self-assessment tax return if any of the following apply to you:
- You are a registered sole trader who has earned more than £1,000 (before tax).
- Your total taxable income exceeds £100,000.
- You are liable for the High Income Child Benefit Charge.
If you remain uncertain, the government tool can help clarify whether you need to file your self-assessment.
How to Register for Self-Assessment
To register for self-assessment, visit the government’s registration portal. If you registered last year and did not submit a tax return, remember that you must register again this year.
Required Documentation for Self-Assessment
The documents needed for self-assessment vary based on your employment status and any other income sources such as benefits or rental properties. Generally, you will need:
- Unique Taxpayer Reference (UTR)
- Government Gateway User ID
- National Insurance Number
- Issued Invoices
- Salary and income from other employment
- Employer Benefits
- Pension or state benefits income
- Rental property income
- Student loan details and repayment amounts
How to Submit Your Tax Return
Once registered, you can file your self-assessment online at gov.uk. Ensure accuracy by keeping thorough records, including:
- Sales and income data
- Business expense records
- All VAT information (if applicable)
- PAYE records (for any employees)
- Personal income documentation
Retain these records for at least five years following your last self-assessment submission.
Should You Hire an Accountant?
While hiring an accountant is not mandatory, doing so can prevent costly mistakes, such as miscalculations or incomplete data. Accountants can help you accurately report allowable expenses and identify potential deductions you may overlook.
Before making a decision, check if your business bank account includes access to an accountancy service. Even if it doesn’t, many business accounts seamlessly integrate with accountancy software, simplifying your financial management.
Recommended Software for Self-Assessment
Utilizing dedicated software for self-assessment can significantly ease the filing process. Ensure any software you select meets these criteria:
- Compliance with UK tax standards and the fiscal year (April 6 – April 5)
- Integration capability with UK bank accounts
- Ability to manage diverse income sources (employed, self-employed, property, pension, etc.)
- Adherence to UK data security regulations
- Provision of deadline reminders
Beginning in April 2026, businesses with an annual income over £50,000 must use software compatible with Making Tax Digital (MTD), which requires quarterly reporting of income and expenses.
For example, Sage’s self-assessment software streamlines expense tracking by allowing you to photograph and scan receipts on-the-go. Its AI-powered automation categorizes your expenses, enabling you to generate a pre-filled self-assessment form that you can submit through the government portal. Explore Sage’s self-assessment software for more information.
Important Self-Assessment Deadlines
Keep track of these crucial self-assessment dates:
- October 5: Deadline to register for self-assessment
- October 31: Paper form submission deadline
- December 30: PAYE tax collection deadline
- January 31: Online submission deadline; first ‘payment on account’ due
- April 5: End of the tax year; claim overpaid tax deadline
- April 6: Start of the new tax year
- July 31: Second payment on account due
Need Assistance? Find Support for Your Tax Return
If you still have questions or need additional guidance, consulting an accountant is a wise choice. Furthermore, the government provides a wealth of resources to assist you, especially as a first-time filer. Visit this government page for more information.
For further assistance, explore Sage’s accounting software here.
Read More
Six Reasons to Tackle Your Self-Assessment Tax Return Early – Emily Coltman, chief accountant at FreeAgent, discusses the advantages of early submission.
Should You Register as a Sole Trader or Limited Company? – Mart Abramov, CEO of TaxScouts, explores the pros and cons of each structure to help you decide.
Best Business Bank Accounts for Sole Traders – We’ve compiled a list of top business bank accounts tailored for sole traders.
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