How do I register for tax and National Insurance?
This section is all about how you register as self-employed for income tax and National Insurance contribution (NIC) purposes.
If you have decided to work for yourself by becoming self-employed, firstly you need to make sure that you are actually going to be self-employed for tax and National Insurance contributions (NIC) purposes as HM Revenue & Customs (HMRC) will need to be happy this is the case and that you are not in fact an employee instead. Have a look at our ‘employed, self-employed, both or neither’ page to help you work it out. It is possible to have two jobs where you are employed in one and self-employed in another.
No tax or NIC is normally deducted from self-employed income (your ‘trading income’) so you are responsible for making the necessary payments to HMRC. The exception is that subcontractors in the construction industry often have tax deducted made from payments made to them. You can read more about the Construction Industry Scheme ('CIS') on GOV.UK.
By law you are required to register with HMRC so they know they have to issue you with notice to complete a self assessment tax return and send you tax statements when required.
You might also need to consider whether you will need to register for VAT (Value Added Tax). See our VAT page for more information.
You can register in several ways:
- online on HMRC’s website
- by completing form CWF1
- phoning the HMRC helpline for the newly self-employed
- completing a (structured) email to HMRC.
The registration process covers both tax and National Insurance contributions (NIC).
You should register with HMRC as soon as possible after you start trading, and by 5 October following the end of the tax year in which you started self-employment at the latest.
Novak started trading on 1 January 2017. The latest date that he should notify HMRC that he has started trading is 5 October 2017.
If you do not register by the relevant dates you may have to pay a penalty. See our penalties page for more information.
You may also need to register separately for VAT. See our VAT page for more information on whether you need to register and how VAT works for the self-employed.
You need to find out your National Insurance number (NINO) first. You can find your NINO on payslips, benefit letters, or any other correspondence from HMRC. If you still cannot find it then see our page 'What to do if I lose or forget my National Insurance number'.
You can be charged penalties as well as interest if you do not register or do so late. You should make registering a priority when you decide to become self-employed.
The penalties are based on the potential lost tax revenue that arises as a result of the failure to notify on time. The amount of penalty charged depends on the behaviour giving rise to your failure to notify and this has to fall into one of the following categories – not deliberate, deliberate but not concealed, deliberate and concealed. HMRC may reduce the penalty if you cooperate, by telling them about the failure, by helping them work out the tax due and by giving HMRC access to information and documents they need to check your position.
Each year, shortly after 5 April, you will be notified by HMRC that you need to complete a tax return. You will either be sent a notice to complete a tax return in the post or, if you have signed up for electronic communications via your personal tax account, you will receive a message in this account. If you are registered for HMRC’s online services (for example if you registered online), you may find that the self assessment link will redirect you to your personal tax account which will have been automatically created for you, as the personal tax account is HMRC’s preferred method for submitting online tax returns.
You can obtain details in the section 'What NIC do I pay if I am self-employed?'.
HMRC publish a range of useful guides that give further information about starting a business.
You can find more information on starting up a business on the GOV.UK website.
If you need further help from HMRC on registering for tax or NIC you can contact the newly self-employed helpline.