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A sole trader is the simplest way to start trading legally in the UK. Tax2U submits your HMRC registration on your behalf so you can focus on your business from day one.
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A sole trader is the simplest form of running your own business in the UK. You work for yourself, keep all profits after tax, and are personally responsible for any losses. You don't need to register at Companies House — you only need to register with HMRC for Self Assessment.
You are trading as a sole trader if you invoice clients directly, set your own rates, supply your own equipment, or take on profit and risk yourself. This includes tradespeople, freelancers, online sellers, consultants, CIS subcontractors and anyone earning outside a standard PAYE contract.
When you register as a sole trader, HMRC automatically enrols you in Self Assessment and issues a UTR (Unique Taxpayer Reference) number — your personal identifier needed to file your annual tax return. Tax2U handles both in a single application.
HMRC requires you to register as a sole trader by 5 October following the first tax year you start trading. Missing this deadline triggers automatic financial penalties even if you owe no tax.
As a sole trader you pay Income Tax on profits above £12,570, plus Class 2 and Class 4 National Insurance. You report everything through an annual Self Assessment tax return — your UTR number is required to do this.
Yes — as a sole trader you can trade under any business name without registering it. The name just cannot include "Limited", "Ltd" or suggest you are a company. Your HMRC registration stays in your personal name.
Once HMRC processes your registration, they issue your UTR number and post it to your home address. Tax2U sends an interim confirmation letter immediately after submission so you have proof of your registration date straight away.
Most people starting out choose sole trader for its simplicity and low cost. Here's how the two structures compare so you can make the right decision.
| Feature | Sole Trader ✓ | Limited Company |
|---|---|---|
| Where you register | HMRC only | Companies House + HMRC |
| Setup cost & complexity | Simple & low cost | Higher |
| How you pay tax | Income Tax + NI on profits | Corporation Tax on profits |
| Personal liability | Unlimited (personal assets at risk) | Limited |
| Business trading name | Any name — no registration | Must register at Companies House |
| Annual admin burden | Low | High |
| Best suited for | Starting out, lower turnover | Higher turnover, multiple employees |
Tax2U collects everything through a secure online form — no uploads required upfront, no post, no calling HMRC. Have these details to hand and you can complete your application in under 5 minutes.
Found on your payslip, P60, or any HMRC letter. Format: QQ 12 34 56 A. HMRC uses this to link your sole trader record to your NI contributions.
The date you first started trading or earning self-employed income. This sets your first tax year and determines which deadlines apply to you.
HMRC posts your UTR number and registration confirmation to your home address. Make sure it's correct — HMRC letters cannot be re-sent electronically.
If you plan to trade under a business name rather than your own name, let us know. We include this in your registration — no separate registration required.
A passport or UK driving licence. Tax2U uses this to verify your identity before submitting your application to HMRC as an authorised agent.
A utility bill, bank statement, or council tax letter dated within the last 3 months. Confirms your address for HMRC's records.
Fill in Tax2U's secure online form with your personal details, NI number and business start date. The whole process takes under 5 minutes. No Government Gateway account required.
A Tax2U accountant reviews your application and submits it to HMRC via the authorised agent portal. You receive an email confirmation with your interim confirmation letter.
HMRC processes your sole trader registration and posts your UTR (Unique Taxpayer Reference) letter to your home address. Your UTR is also stored securely in your Tax2U dashboard.
You can register as a sole trader yourself through HMRC's website — but it requires a Government Gateway account, takes longer, and offers no support if anything goes wrong.
| What you get | Tax2U — From £24+VAT | HMRC Direct (Free) |
|---|---|---|
| Government Gateway account needed | ✓ Not required — we handle it | ✗ You must create one |
| Submission speed | ✓ Within 24 hours | ✗ 4 — 5 weeks |
| Error check by a qualified accountant | ✓ Reviewed before submission | ✗ No check — errors go directly to HMRC |
| Dedicated account manager | ✓ Assigned on registration | ✗ No personal support |
| Support if HMRC queries arise | ✓ Tax2U handles HMRC correspondence | ✗ You deal with HMRC directly |
| UTR stored in secure dashboard | ✓ Accessible any time | ✗ Only on HMRC's posted letter |
| Trading name included in registration | ✓ Included at no extra charge | Self-managed |
Over 8,000 people have used Tax2U to register as a sole trader. Here's what a few of them told us.
Answers to the questions we hear most often. Can't find what you're looking for? Call our team on 020 7118 0097.
Join 8,000+ sole traders, freelancers and CIS subcontractors who've trusted Tax2U to handle their HMRC registration. From £24 + VAT — handled by HMRC-authorised agents.
Get Started — £24 + VAT →5-minute online form · No Government Gateway account needed · UTR delivered by post from HMRC
Check your email to verify and continue your application.
