Informing HMRC that you are Self-Employed

3rd March 2017

Registering with HMRC

When you decide to become a freelancer, you need to inform HMRC that you are now self-employed. This means that you are working for yourself and you are now responsible for paying all Income tax and National insurance contributions.

It is best to let HMRC know as soon as possible as soon as or at least when you have issued your first invoice as a freelancer. HMRC does allow a leeway of 3 months to inform them that you are self-employed before issuing a £100 late notification fine.

Information needed for Registration

The process can be completed online. Since you cannot save any progress made during the online process you will need to collect all the required documents before completing the registration. The following information will be needed.

  1. 1. Name
  2. 2. Address
  3. 3. National Insurance number
  4. 4. Date of birth
  5. 5. Contact telephone number
  6. 6. Contact email address
  7. 7. Date that you became self-employed
  8. 8. Nature of your business
  9. 9. Your business address

Completing Self-Assessments and Tax Returns

Online registration can be completed for Self-Assessment. Failure to register can result in penalties. Hence you must register by the 5th of October.
To pay your tax return you will need your Unique Tax Reference (UTR). This tax return must be filed online by the 31st of January.

Paying National Insurance Contributions (NICs)

As a self-employed Freelancer you need to register to pay National Insurance contributions (NICs). There are two classes of NICs depending on your profits. Class 2 will apply if your profits are £5,965 or more a year or Class 4 will apply if your profits are £8,060 or more a year. Note that if you do not make more than £5,965 profit a year, than no NICs is due. However, it is recommended that a voluntary contribution is made.

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