First-Time Self-Employed? What You Need to Know

The start of a new tax year can be a daunting time for self-employed individuals. Especially those who have not previously completed a self-assessment tax return. However, being aware of what HMRC expects from you can make your first self-assessment much more straightforward.

I’m self employed, when do I need to complete a self-assessment and register with HMRC?

As a self-employed individual, you are required to complete a tax return when your gross income exceeds £1,000. This is because HMRC provide a £1,000 tax-free trading allowance to all self-employed individuals. Should you be over this limit, you are receiving taxable income and must inform HMRC.

To inform HMRC, you must create a Government Gateway ID account on the HMRC website. Once the account has been created, you can register as self-employed. This informs HMRC that you have exceed the threshold and will generate a tax return for the tax year.

Inform HMRC by 5 October after the tax year in which you exceeded the threshold that a return is required.

When does the tax return need to be submitted and what should be included?

Once registered for self-assessment, you have until 31 January after the end of the tax year to submit an online return. If submitting a paper return, the deadline is 31 October following the end of the tax year. For example, the 2025-26 tax year ending 05 April 2026, is due by 31 January 2027 online. This gives just under 10 months to ensure your self-assessment is complete, compliant and submitted to HMRC with liability paid.

Income and expenses relating to your self-employment must be included on the return. Other income that isn’t taxed at source is required to be included on the return, e.g. bank interest or dividends.

Self-assessments are typically prepared on the cash basis. This means that only income received and expenses paid during the year are to be included on your return. Therefore, you are only required to include revenue you have actually received. You are not required to include invoices you have raised but not yet received.

You may also be able to include certain expense provisions or allowances, depending on your circumstances. However, it is recommended that these are discussed with your accountant before being included on your tax return.

When do I need to pay my tax liability?

Once your self-assessment has been completed and submitted to HMRC, the tax liability is due by 31 January of the following year.

However, if your tax liability is over £1,000 you may be required to make payments on account. HMRC assumes you will have a similar tax liability the following tax year, so advanced payments are required to spread the cost.

Payments on account are due in two equal instalments on 31 January and 31 July. Therefore, on 31 January you may be required to pay your outstanding liability for the year, and an additional 50% of that tax liability as a payment on account towards the following year.

If your gross self-employment income exceeds certain thresholds, you may also be required to comply with Making Tax Digital (MTD) for Income Tax. This would require quarterly submissions of income and expenses to HMRC. If you would like any further information on MTD for Income Tax, it is advised that you discuss this with your accountant.

Final thoughts

One final key takeaway is that just because you have until the 31 January to submit your return, doesn’t mean you need to wait until then.

In 2026, over 475,000 people submitted their return to HMRC on the final day before the deadline, but you can submit your tax return straight away from 6 April, should you be that prepared.

Submitting your self-assessment early can help relieve stress later down the line and give you more time to prepare for upcoming tax payments.