Self assessment: the no-panic guide for freelancers

Self assessment isn't scary — it's just admin

If you're freelancing in the UK, you need to do a self assessment tax return. Full stop. HMRC wants to know what you earned, what you spent on the business, and how much tax you owe.

The process is straightforward once you understand the timeline. The stress comes from leaving it until the last minute. So let's make sure that doesn't happen.

The key dates you need to know

The UK tax year runs from 6 April to 5 April. Your self assessment covers the tax year that's just ended. So for the 2025/26 tax year:

• 6 April 2025 — Tax year starts
• 5 April 2026 — Tax year ends
• 5 October 2026 — Deadline to register for self assessment (if it's your first time)
• 31 October 2026 — Paper return deadline (but honestly, just file online)
• 31 January 2027 — Online filing AND payment deadline

Miss the 31 January deadline and HMRC charges you £100 immediately — even if you owe nothing. After three months, daily penalties kick in. Don't be that person.

What you actually need to report

Your tax return asks for:

• Total income from freelancing (every invoice you sent)
• Allowable expenses (things you bought for the business — software, equipment, travel)
• Other income (employment, savings interest, rental income)

The difference between your income and expenses is your taxable profit. That's what HMRC taxes you on.

What counts as an expense?

The rule is simple: if you bought it wholly and exclusively for your business, you can claim it. Common freelancer expenses include:

• Software and subscriptions (design tools, accounting software, project management)
• Equipment (laptop, monitor, phone — if used for work)
• Home office costs (simplified expenses: £6/week flat rate, no receipts needed)
• Travel to client meetings
• Professional development and courses
• Accountant fees

How much tax will you pay?

As a sole trader, you pay:

• Income Tax on your taxable profit (after the £12,570 personal allowance)
• Class 2 National Insurance — £3.45/week if profits above £12,570
• Class 4 National Insurance — 6% on profits between £12,570 and £50,270

Quick example

You invoice £35,000 in a year. You claim £5,000 in expenses. Your taxable profit is £30,000.

• First £12,570: tax-free
• Next £17,430 (up to £30,000): taxed at 20% = £3,486
• Class 4 NI on £17,430: 6% = £1,046
• Class 2 NI: ~£179/year

Total tax bill: roughly £4,711. That's about 13.5% of your total invoiced amount. Much less scary when you see the maths.

Payments on account (the bit that catches people out)

Once your tax bill is over £1,000, HMRC makes you pay in advance for the next year. They call this "payments on account." It works like this:

• 31 January: Pay your tax bill PLUS 50% of next year's estimated bill
• 31 July: Pay the other 50%

This means your first January payment feels massive because you're paying for two years at once. After that, it evens out. Budget for it.

How to actually file

• Log into your HMRC online account (Government Gateway)
• Go to Self Assessment and start your return
• Fill in the self-employment section with your income and expenses
• HMRC calculates what you owe
• Pay by 31 January (bank transfer, debit card, or Direct Debit)

The whole thing takes about an hour if your records are in order. If they're not, it takes a miserable weekend. Keep your records tidy throughout the year and future you will be very grateful.

One last thing

If you earn under £1,000 from self-employment, you don't need to register or file. That's the "trading allowance." But once you're over that threshold — even by a quid — you need to tell HMRC.

Self assessment is just the price of freelancing freedom. Do it once, do it properly, and it stops being something you dread.