Do I Need to Register as Self-Employed?
- Kyle Randall
- Dec 18, 2025
- 3 min read
Understanding Self-Employment in the UK
If you earn money outside of employment, you may be required to register as self-employed with HMRC. This is one of the most common questions people ask when starting a side hustle, freelancing, or running a small business.
Registering correctly — and on time — is important. If you fail to do so when required, you could face penalties or issues later when filing your tax return.
In this guide, we explain when you must register as self-employed, when you don’t, and what to do next.
What Does Being Self-Employed Mean?
You are generally considered self-employed if you:
Work for yourself
Invoice clients for your work
Are responsible for your own tax
Are not paid through PAYE
Common examples include freelancers, contractors, consultants, tradespeople, online sellers, and people with side businesses.
When Do You Need to Register as Self-Employed?
You must register as self-employed if both of the following apply:
You earned more than £1,000 from self-employment in a tax year
The income was not taxed at source
This £1,000 threshold is known as the trading allowance. Once your self-employment income exceeds this amount, registration is required.
When You May Not Need to Register
You may not need to register as self-employed if:
Your total self-employment income is £1,000 or less
The income is a one-off or very occasional
All your income is taxed through PAYE and you have no untaxed earnings
However, even small amounts of income can still require reporting in certain situations, so it’s always worth checking.
What Happens When You Register as Self-Employed?
Once registered, you will:
Receive a UTR number
Be required to submit a Self Assessment tax return each year
Pay Income Tax and National Insurance on your profits
Need to keep records of income and expenses
You can learn more about UTR numbers in our guide here:[Internal link: UTR Number blog]
How and When to Register
You must register by 5 October following the end of the tax year in which you started self-employment.
👉 You can register directly with HMRC here:https://www.gov.uk/register-for-self-assessment
(External link — official HMRC guidance)
Registering late can lead to penalties and unnecessary stress.
What If You’re Employed and Self-Employed?
Many people are both employed and self-employed.
In this case:
PAYE continues to apply to your employment income
Your self-employment income is declared through Self Assessment
This is very common and perfectly allowed — but it does mean additional reporting responsibilities.
Common Mistakes People Make
Assuming side income doesn’t count
Missing the £1,000 threshold
Registering too late
Not keeping proper records
Forgetting to submit a tax return even after registering
Avoiding these mistakes early can save money and hassle later.
How VIP Accounting Ltd Can Help
At VIP Accounting Ltd, we help individuals and business owners across Benfleet, Essex and the UK with:
Registering as self-employed
Obtaining UTR numbers
Filing Self Assessment tax returns
Claiming allowable expenses
Staying fully compliant with HMRC
You can learn more about our Self Assessment services here:
Or speak to our team directly via our contact page.
FAQs
Do I need to register if it’s just a side hustle?
Yes — if you earn more than £1,000 in a tax year.
Can I register late if I missed the deadline?
Yes, but penalties may apply. It’s best to act as soon as possible.
Do I need to register every year?
No — once registered, you stay registered unless you stop trading.
What if I make a loss?
You still need to file a tax return, even if your business makes a loss.
Who Wrote This Article
Kyle Randall, Founder of VIP Accounting Ltd, provides clear, practical guidance to help individuals and business owners understand UK tax obligations and stay compliant with HMRC.
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VIP Accounting Ltd is a strategic accounting and tax advisory firm based in Benfleet, Essex, supporting individuals, sole traders, and businesses across the UK with Self Assessment, tax planning, accounting, and HMRC compliance.
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