Experienced Sole Trader Accountants
Based in London
At Lesstax 4 U, our sole trader accountants have extensive experience in all areas of accounting. Serving clients in Woolwich, London, and throughout the UK, we can help you complete your self-assessment tax return and provide general advice. We also provide support and advice for those in partnerships or the Construction Industry Scheme. Get in touch with our accountants today to request more information.
Sole Trader
Being a sole trader merely means that there is no distinction between the owner and the business because you run your own business as an individual and are classified as self-employed. You need to set up as a sole trader and file a tax return if any of the following apply:
- You Earned More than £1,000 from Self-Employment within the Tax Year (between 6th April and 5th April the Following Year)
- You Want to Make Voluntary Class 2 National Insurance Payments to Help You Qualify for Benefits
To set up as a sole trader, you need to tell HMRC on or before 5th October following the end of the tax year that you are self-employed, and you have to pay tax through Self-Assessment.
For example, If you started trading during the 2025 to 2026 tax year, you must register on or before 5 October 2025. You’ll need to file a tax return every year by simply registering for Self-Assessment and once registered the deadline for filing by paper is 31st October 2026 or 31st January 2027 for online filing.
Your Responsibilities
As a sole trader, you can keep all your business’s profits after you’ve paid the appropriate taxes. You’re personally responsible for in decision-making. You must also follow certain rules for running and naming your business and maintaining compliance and protecting your investment. Additionally, you are required to:
- Keep Records of Your Business’s Sales and Expenses
- Send a Self-Assessment Tax Return Every Year
- Pay Income Tax on Your Profits and Class 2 and Class 4 National Insurance
- Business Insurance
- VAT Registration
- Payroll if you employ people
These obligations assist you stay out of trouble with the law and are necessary for the efficient running of your sole proprietorship. It’s critical to keep up with any regulatory changes and make sure your company complies with all applicable laws.
VAT Registration
You must register for VAT if your turnover is over £90,000. You can register voluntarily if it suits your business, e.g., if you sell to other VAT-registered businesses and want to reclaim the VAT.
CIS Returns
What is a CIS return? And how to file your monthly submission with HMRC
You’ve probably heard of a CIS Return if you’re a contractor in the construction sector. If not, you should familiarize yourself with it as soon as possible!
HMRC uses the Construction Industry Scheme (CIS) to ensure that the right amount of tax is paid on subcontractor work, and you inform them of the payments and deductions made each month through your CIS Return.
Let’s make filing your CIS return simple
What is a CIS Return?
- Contractors – including sole traders, partnerships, and limited companies who hire subcontractors for construction work.
- Deemed contractors – businesses whose average annual spend on construction is above £3 million in the 12 months since your first payment. Even if construction isn’t their main activity.
Filing your CIS Return on time and accurately, keeps you compliant and makes the tax process smoother for everyone involved.
Filing your monthly CIS Return
- Gather your subcontractor details
Names, Unique Taxpayer Reference (UTR), and payment amounts for the month.
- Verify your subcontractors
Check their CIS status with HMRC (gross payment based on appplication, standard 20% deduction for verified subcontractors , or higher 30% deduction for unverified subcontractors).
- Calculate tax deductions
Work out how much tax you need to deduct based on each subcontractor’s status.
- Complete your CIS Return
You can do this through:
- HMRC’s CIS online service
- HMRC-approved accounting software
- Or let our accountant handle it all for you
- Submittion deadline is by 19th of every month
Always file on or before the monthly cut-off to avoid penalties.
- Give subcontractors their payment and deduction statements
These are needed for their own tax records.
If you’re working in the construction industry as a contractor or subcontractor, you can register for the Construction Industry Scheme (CIS) with HMRC.
As a sole trader you must file your tax return on paper on or before 31 October or 31 January for online submission to avoid a late-filing penalty.
CIS Returns
If you’re working in the construction industry as a contractor or subcontractor, you can register for the Construction Industry Scheme (CIS) with HMRC.
You must file your tax return on paper on or before 31 October or 31 January for online submission to avoid a late-filing penalty.
Partnership
In a partnership, you and your partner (or partners) personally share responsibility for your business. This includes:
- Any Losses Your Business Makes
- Bills for Things You Buy for Your Business, Like Stock or Equipment
- Partners Share the Business’s Profits and Each Partner Pays Tax on Their Share.
When you set up a business partnership, you need to nominate a partner who will be responsible for managing the partnership’s tax returns and keeping business records. A partner does not have to be an actual person. For example, a limited company counts as a ‘legal person’ and can also be a partner.
There are different rules for limited partnerships and limited liability partnerships (LLPs). Each partner must register with HMRC separately and a nominated partner must register the partnership files the partnership tax return.
Providing Sole Trader Services
Our sole trader accountants cover all your needs, from registration to self-assessment tax returns.