Self-employed – running a business and paying tax

Being self-employed means:

• Running your own business
• Being responsible to work out and pay your own tax
• Dealing with HM Revenue and Customs

You can ask an accountant or tax adviser to deal with HM Revenue and Customs on your behalf, but you still remain responsible for what they do.

There is a separate section on this website on starting a new business, so if you are looking for guidance on starting a new business, please read that first.

This section of the website is aimed at providing information about how being self-employed impacts on your tax situation. For help with completing a tax return, we suggest you also look at our Tax Return guide. If you are unsure if you are self-employed or employed, see the employed or self-employed section.

Running your own business

There are many, many aspects to running your own business – too many to cover in a single section on a website! You are responsible for health and safety, finance, tax, employees, marketing, record keeping  …  the list goes on.

If you have an accountant, they can help you. You might also want to look at the Government services and information website for information and ideas: https://www.gov.uk/browse/business.  There is a useful set of ‘Tax Help Factsheets’  on the  Gov.uk website. These cover, for example, Keeping records, Self-assessment three line accounts, Paying tax and Working for yourself and other subjects.

In the sections below, we will be looking at one particular aspect of running your own business – tax – and your relationship with HM Revenue and Customs (HMRC). There are many aspect of tax that could affect your business. These include:

• Stamp and other taxes if you buy or sell property or shares:
  • https://www.revenue.scot/land-buildings-transaction-tax (land and buildings – Scotland)
  • https://www.gov.uk/topic/business-tax/stamp-taxes (land and buildings rest of UK)
  • https://www.gov.uk/guidance/stamp-duty-reserve-tax-the-basics
• VAT – https://www.gov.uk/topic/business-tax/vat
• Income tax  and National Insurance (see pages on TaxAid website)
• PAYE as an employer – https://www.gov.uk/paye-for-employers
• Construction Industry Scheme – https://www.gov.uk/what-is-the-construction-industry-scheme
• Capital Gains Tax – if you sell your business, business investments or business property – https://www.gov.uk/capital-gains-tax