Taxes for a Self-Employed Person in UK

Updated on Tuesday 09th May 2017

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If you have settled in the UK and you wish to start your own business, it is recommended to ask for assistance in taxation matters. Besides giving full information and guidance about the needed visas to enter the UK, our immigration solicitors in London can provide you with details about how to pay your taxes as a self-employed person in the country.

Register for VAT as a self-employed in the UK

The HMRC (Her Majesty’s Revenue and Customs) is in charge with the taxes on companies and natural persons in the UK. If your business has profits above £85,000 you should register for VAT with the HMRC, where you need to provide your documents as a self-employed, in order to receive the VAT certificate. If your gains are less than £85,000, you can register voluntarily for VAT, unless your business deals with products which are exempt from taxation. Once you have received the VAT certificate, you will pay the taxes to the HMRC, submit the VAT returns and of course keep the records of such tax. We remind that the standard VAT rate for goods and services in the UK is settled at 20%. if you want to study in the UK,  you should apply for a student visa and before that ask for complete information from our immigration lawyer in London.

The National Insurance Contributions in the UK for self-employed persons

Local or foreign self-employed persons in the UK need to register for the National Insurance Contributions (NIC) and pay the taxes to the HMRC. Moreover, it is good to know that no NIC or tax is deducted from self-employed revenue, but the necessary payments need to be made to the HMRC in the UK. A self-assessment tax return needs to be filled at the end of the year with the authorities in charge, in order to see what taxes you need to pay. Our immigration lawyer in London can offer guidance in this matter if you want to relocate in the country and start your own business.

NIC classes in the UK

There are two different NIC in the UK, according to the type of business and profits you have. For instance, the Class 2 NIC implies a tax of about £3/week from the obtained revenues which are falling under the category with low profits as a self-employed. The Class 4 NIC is available for larger profits of self-employed businesses in the UK, which sums up around £ 45,000 per year, where a 2% income tax will be imposed.

If you want to know more details about the taxes you need to pay as a self-employed person in the UK, we invite you to contact our team of immigration solicitors in London. You can also receive immigration services if you are interested in relocating to the UK.


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