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From 6 January 2024, the main rate of class 1 National Insurance contributions (NIC) deducted from employees’ wages is reduced from 12% to 10%. From 6 April 2024, the main rate of self-employed class 4 NIC will reduce from 9% to 8% and class 2 NIC will no longer be due. Those with profits below £6,725 a year can continue to pay class 2 NIC to keep their entitlement to certain state benefits. Our guidance will be updated in full in spring 2024.

Updated on 6 April 2023

Self-employment: a guide

Our PDF guide to self-employment supplements the information in this self-employment section.

Our guide to self-employment aims to help:

  • self-employed people who want detailed tax and related information in one accessible place, and
  • non-tax specialists who advise low-income self-employed individuals.

The guide covers setting up as a sole trader or a partnership and how to register with HMRC. It explains how you can prepare accounts, what business records you need to keep and how to complete your tax return. It contains detailed case studies showing how to prepare accounts and what to include on your 2022/23 tax return, using either the cash basis or the accruals basis.

The guide covers other areas you may need to consider if you decide to grow your business such as taking on staff or registering for VAT. It also explains what you need to do if you decide to stop trading and has detailed guidance on tax credits and universal credit for the self-employed.

You can download the guide here.       

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