# Do I need an accountant as a sole trader?

Pick My Accountant (https://pickmyaccountant.co.uk/answers/do-i-need-an-accountant-as-a-sole-trader/): Do I need an accountant as a sole trader? — Quick answer. No — a UK sole trader has no legal requirement to use an accountant. You can register with HMRC, keep your own records, and file self assessment yourself. An accountant becomes worth the £39–£89 monthly fee once your income grows, you register for VAT, claim significant expenses, or Making Tax Digital quarterly reporting applies to you.

## Key facts

- No legal requirement — self assessment is designed for self-filing
- Typical sole trader package: £39–£89/month; one-off returns from about £150
- MTD for Income Tax starts April 2026 for self-employment income over £50,000 (April 2027 for over £30,000)
- The £1,000 trading allowance means very small side incomes may not need a return at all
- Accountancy fees are themselves a deductible business expense

## When DIY is perfectly fine

If you have one income stream, straightforward expenses, turnover comfortably under the VAT threshold, and you keep records as you go, self-filing is realistic. HMRC's online return walks through most situations, and bookkeeping apps handle the arithmetic. Thousands of sole traders file confidently every January without help.

## When an accountant starts paying for itself

The tipping points are usually: VAT registration (quarterly returns and scheme choices), the Construction Industry Scheme, multiple income sources (rental property, dividends, foreign income), hiring subcontractors or staff, or simply earning enough that missed reliefs cost more than fees. From April 2026, Making Tax Digital for Income Tax adds quarterly digital submissions for the self-employed earning over £50,000 — a common trigger for getting help.

## A middle path

Many sole traders pay for a one-off self assessment review (roughly £150–£300) rather than a monthly package — you keep the records, the accountant checks the return, claims what you missed, and files it. It's a cheap way to learn what a full service would add.

## FAQs

**Q: Can an accountant reduce my tax bill?**
A: Legitimately, yes — by claiming allowable expenses you missed (use of home, mileage, capital allowances), choosing the right accounting basis, and timing purchases. They cannot invent deductions, but most self-filers under-claim.

**Q: What records do I legally need to keep?**
A: Records of all income and expenses, kept for at least 5 years after the 31 January filing deadline. Digital records will be required under Making Tax Digital as it phases in from April 2026.

**Q: Should I become a limited company instead?**
A: It depends on profit level, liability, and admin appetite — the tax advantage of incorporating has narrowed. This is exactly the question worth a one-off session with a qualified accountant.

Updated: 2026-07-08

Source: https://pickmyaccountant.co.uk/answers/do-i-need-an-accountant-as-a-sole-trader/