First Time Filing a Self Assessment Tax Return? Here’s Your Sole Trader Survival Guide
If you’ve just started working for yourself and the words “Self Assessment” make you want to hide under a blanket—don’t worry, you’re not alone. Every year, thousands of sole traders Google things like:
“Do I need to register for Self Assessment?”
“What can I claim as expenses?”
“How do I actually file the thing?”
This guide is here to answer all those questions (and a few you didn’t know you had) in plain English. No jargon. No judgment. Just clear, friendly advice to help you file your first tax return with confidence.
What Is a Self Assessment Tax Return?
Self Assessment is how HMRC finds out how much tax and National Insurance you owe. If you’re a sole trader and earned more than £1,000 in the tax year (6 April to 5 April), you’ll need to file one.
It’s not just about income—you’ll also report your expenses, claim tax reliefs, and pay what’s due. You can file online or on paper (but let’s be honest, online is way easier).
Do I Need to Register for Self Assessment?
Yes—if you’re self-employed and earned over £1,000, you must register with HMRC. The deadline is 5 October following the end of the tax year in which you started trading.
Once registered, you’ll get a Unique Taxpayer Reference (UTR) and access to your online account.
Register for Self Assessment on GOV.UK
What Counts as Business Income?
Basically, any money you earn from your business. That includes:
Payments from clients or customers
Online sales (Etsy, eBay, Shopify, etc.)
Freelance gigs or side hustles
Tips, commissions, or bonuses
Even if you’re paid in cash or via PayPal—it all counts.
What Are Allowable Expenses?
These are the costs you can deduct from your income to reduce your tax bill. HMRC says they must be “wholly and exclusively” for your business.
Common examples:
Office supplies, software, and subscriptions
Phone and internet bills (business portion)
Travel for work (not commuting)
Marketing, website hosting, and branding
Professional fees (like accountants!)
You can’t claim for personal expenses like your weekly grocery shop or Netflix subscription.
Full list of allowable expenses on GOV.UK
What Are the Key Deadlines?
5 October – Register for Self Assessment
31 January – File your return and pay your tax
31 July – Second payment on account (if applicable)
Miss a deadline? HMRC will fine you £100, even if you owe no tax.
What’s Cash Basis Accounting—and Should You Use It?
Cash basis means you only report income and expenses when the money actually moves. It’s simpler and great for sole traders.
Pros:
Easier to manage
Helps with cash flow
No need to track unpaid invoices
Learn more about cash basis accounting
What Records Do I Need to Keep?
HMRC expects you to keep clear records for at least 5 years.
You’ll need:
Invoices and receipts
Bank statements
Mileage logs (if you drive for work)
Proof of expenses
Digital or paper is fine—just make sure it’s organised and accessible.
Can I Do It Myself or Should I Get an Accountant?
You can file your return yourself using HMRC’s online portal. But if you’re unsure, nervous, or just busy, an accountant can:
Make sure you claim everything you’re entitled to
Help you avoid mistakes and penalties
Save you time and stress
Think of it as an investment in peace of mind.
What If I Make a Mistake or Miss the Deadline?
Mistakes happen. The good news? You can usually amend your return within 12 months.
But if you miss the deadline or underpay, HMRC may charge:
A £100 late filing penalty
Daily fines after 3 months
Interest on late payments
So it pays to get it right the first time—or get help if you’re unsure.
Feeling Overwhelmed? Let’s Chat
If you’re a sole trader and want to file your tax return without the stress, I’m here to help. I specialise in making tax simple, friendly, and totally doable—even if numbers aren’t your thing.
Book a free call with me today and let’s take the fear out of taxes.