Navigating tax obligations can be daunting for small business owners and sole traders. To make life easier, HMRC has introduced new interactive tools, including a Sole Trader Setup Guide and VAT Registration Estimator, helping businesses understand taxes step by step.
The new resources include:
Sole Trader Setup Guide: A step-by-step guide to help people who are self-employed understand when they need to register as a sole trader and how to do it. The interactive tool explains what records need to be kept, which taxes may apply, and includes other helpful information, such as how to pay a tax bill. The guide is broken down into 7 simple steps:
- Check if being a sole trader is right for you
- Choose your business name
- Check what records you need to keep
- Register as a sole trader
- Check what taxes may apply to you
- Plan for your tax bill
- Get help and support
Additionally, HMRC has released a VAT Registration Estimator tool, which helps businesses assess whether they need to register for VAT based on their turnover. This tool was developed in response to feedback from small businesses who said an online resource would be helpful to understand when their turnover might require VAT registration and how it could affect profits.
These free online tools are expected to help small businesses make informed decisions about their business and tax obligations. The tools have been launched solely for informational purposes and using them will not register users for any taxes. HMRC will not collect or store any information entered through these tools.