Clear online support for registration, bookkeeping, allowable expenses, Self Assessment, tax estimates, Payments on Account and Making Tax Digital—with annual and monthly options.
Accounting designed around a sole trader's responsibilities
New sole traders registering with HMRC for the first time
Established self-employed people who want cleaner bookkeeping and earlier tax estimates
Consultants, tradespeople, creatives, online sellers and service businesses
People earning through several clients, contracts or platforms
Sole traders combining self-employment with PAYE employment or property income
Business owners who want to switch from an unresponsive accountant
Registration & Filing
From your first £1,000 of trading income to the filed return
The £1,000 trading allowance is based on gross trading income before expenses. Once gross income is more than £1,000, registration for Self Assessment is normally required, with a usual deadline of 5 October after the relevant tax year.
We help organise the income and expenses, include relevant personal tax information, prepare the calculation and send the return to HMRC after you approve it.
The recurring jobs that keep your tax position under control
01
Registration & Self Assessment
We explain when registration is required, help gather the information for your return, calculate the tax position and submit the Self Assessment return after your approval.
02
Sole Trader Bookkeeping
Income, expenses, bank transactions and receipts are organised into a repeatable system, either annually or through an ongoing monthly routine.
03
Allowable Expense Review
We review the costs connected with your work, separate business and private use, and include the allowable expenses supported by your records.
04
Tax & National Insurance Planning
We estimate Income Tax and Class 4 National Insurance, explain the effect of other income and help you plan what to set aside before the payment deadline.
05
Payments on Account
We show why advance payments arise, when the January and July instalments are due and how the balancing payment fits into the calculation.
06
MTD Preparation
We check your likely start date, recommend a digital record-keeping setup and prepare you for compatible software, quarterly updates and the annual tax return.
Tax & National Insurance
Plan using profit and your complete income position
Taxable sole trader profit starts with business income less allowable expenses and relevant adjustments. Income Tax is then affected by your other income, allowances and tax bands. Class 4 National Insurance is calculated separately on self-employed profits under the rules for the relevant tax year.
Aurestone estimates the combined position before the filing deadline, so you can make a more informed decision about what to retain for HMRC.
Why the first substantial January bill can feel larger
Payments on Account are advance instalments towards the following year's Income Tax and Class 4 National Insurance. Each is usually 50% of the previous year's relevant liability, due on 31 January and 31 July.
They are not normally required when the relevant amount is below £1,000 or more than 80% of the tax was collected outside Self Assessment. A balancing payment may still be due on 31 January after the tax year.
The scope and fixed fee are agreed after reviewing transaction volume, record quality, income sources and any catch-up work. No numeric starting fee has been assumed.
Making Tax Digital
When sole traders enter MTD for Income Tax
HMRC looks at combined gross qualifying income from self-employment and property before expenses.
Qualifying income
HMRC checks
MTD start date
More than £50,000
2024–25 tax return
6 April 2026
More than £30,000
2025–26 tax return
6 April 2027
More than £20,000
2026–27 tax return
6 April 2028
Sole traders in scope use compatible software to keep digital records, send cumulative quarterly summaries and submit the annual tax return. Check current HMRC MTD guidance.
Switching Accountants
You do not need to wait for the tax year to end
Once you authorise the change, Aurestone can request the professional handover information, confirm which records have already been prepared and agree responsibility for the next Self Assessment or MTD deadline.
You do not need to manage the technical handover yourself or stay with an accountant who no longer responds clearly.
If your gross trading income is more than £1,000 in a tax year, you normally need to register for Self Assessment. The usual registration deadline is 5 October following the end of that tax year. Different considerations can apply if you need to claim a loss or make voluntary National Insurance contributions.
What does a sole trader pay tax on?
A sole trader generally pays Income Tax and Class 4 National Insurance on taxable business profit after allowable expenses and reliefs, not on total turnover. Other income, allowances and personal circumstances affect the final calculation.
Which expenses can a sole trader claim?
The answer depends on the business. Common categories include relevant software, insurance, professional fees, equipment, business travel, premises costs, advertising and the business share of phone or home-working costs. Expenses must meet the tax rules and private use must be excluded.
What are Payments on Account?
Payments on Account are advance instalments towards the following year's Income Tax and Class 4 National Insurance. Each instalment is usually half of the previous year's relevant liability and is due on 31 January and 31 July. They are not normally required if the relevant amount is below £1,000 or more than 80% of the tax was collected outside Self Assessment.
Does Making Tax Digital apply to sole traders?
MTD for Income Tax applies in stages based on combined gross qualifying income from self-employment and property: more than £50,000 from April 2026, more than £30,000 from April 2027, and more than £20,000 from April 2028. Sole traders in scope use compatible software for digital records, quarterly updates and the annual tax return.
Do I need monthly accounting or only an annual tax return?
Annual support can suit a straightforward business with complete, organised records. Monthly support is more useful when transaction volume is higher, records need regular attention, tax estimates matter during the year or MTD quarterly reporting applies.
Can I switch accountants during the tax year?
Yes. You do not need to wait until the tax year ends. With your authority, Aurestone can request the professional handover information and agree which deadlines and records each accountant will handle.
How much does sole trader accounting cost?
The fee depends on whether you need annual or monthly support, transaction volume, record quality, income sources and any catch-up work. We review the position and agree a fixed quote before starting paid work.
Get the right level of accounting support for your sole trade
Book a sole trader review to discuss registration, bookkeeping, expenses, tax estimates, Payments on Account, MTD or switching from your current accountant.
