Accounting

Accountants by industry

Freelancer accountants

Freelancing is self-employment with a particular shape: income from several clients that arrives irregularly, costs spread across equipment, software, subscriptions and a home workspace, and a tax bill that lands in January based on a year that is hard to reconstruct from memory. The accounting is not complicated in principle, a profit figure and a tax return for a sole trader or accounts and a company return for an incorporated freelancer, but it goes wrong when records are kept retrospectively and expenses are reconstructed from bank statements months later. Our service keeps the records monthly so the tax position is visible all year and the return is a formality.

from £45/mo · fixed, per month

Next deadlines

  • Online Self Assessment filing deadline and balancing payment due
  • Making Tax Digital for Income Tax: quarterly updates for sole traders and landlords over £50,000 (from April 2026) and over £30,000 (from April 2027)
  • Second payment on account due
  • Companies House accounts due 9 months after your year end (a 31 December year end files by 30 September)

Fees

Packages, fixed and published

£45/mo

Sole trader freelancer: books + tax return

£79/mo

Limited company freelancer: full compliance

£229/yr

Annual-only: year-end accounts + return

£99

Going freelance starter session

Who this is for

Freelancer Accountants

Freelancers and independent professionals in the UK: designers, developers, writers and editors, marketers, photographers and videographers, consultants, translators, musicians and performers, tutors and coaches, whether trading as a sole trader, through a limited company, or still deciding, and whether full time or alongside employment.

What is included

Inside the fixed fee

  • Monthly bookkeeping from your bank feed with invoices and expenses captured by phone
  • Self Assessment with the self-employment pages for sole trader freelancers, or accounts, CT600 and payroll for company freelancers
  • Expense review for the costs freelancers miss: home office, equipment, software, subscriptions, training, travel
  • Payments on account and a monthly set-aside figure so the January bill is never a surprise
  • Making Tax Digital readiness and quarterly updates when your income reaches the threshold
  • A going-freelance starter session covering structure, registration, pricing for tax and what to keep

In detail

How freelancer accountants works

The sole trader package at £45 a month covers bookkeeping from the bank feed, receipt capture by phone, a monthly summary showing profit and the tax accruing, the Self Assessment prepared and filed, and payments on account calculated. The company package at £79 covers bookkeeping, director payroll with RTI submissions, dividend paperwork, the statutory accounts and CT600, and the confirmation statement, with the director's personal return added at the published £129 where needed. For organised freelancers who keep their own records, the annual-only option at £229 prepares the year-end accounts and return from what you provide. The starter session at £99 sets new freelancers up before the first invoice and is credited against the first month if you join a package.

The sole trader versus company question comes up with almost every freelancer and the honest answer depends on numbers. At profits below roughly £30,000 to £40,000 the tax saving from incorporating is small once the extra compliance cost is counted, and a sole trader structure is simpler. Above that, or where clients insist on contracting with a company, or where the work carries liability that a company would contain, incorporation starts to make sense. The decision also affects Making Tax Digital, which applies to sole traders and landlords but not companies, and the ability to leave profits in the business. We run the comparison on actual figures and revisit it as income changes.

Expense review is where freelancers most often lose money. The home workspace is claimable either as a proportion of actual household costs by rooms and hours or at HMRC's flat rate; equipment such as laptops and cameras qualifies for capital allowances or is simply expensed under the cash basis; software subscriptions, professional memberships, insurance, training that maintains existing skills, marketing, website costs and the business share of phone and internet are all allowable; business travel is claimable but ordinary commuting is not. Items bought before trading started can be brought in at market value. We review the categories monthly, so by the time the return is prepared nothing is left to reconstruct.

Making Tax Digital for Income Tax now applies to freelancers with gross self-employment and property income over £50,000 in 2024/25, with the £30,000 threshold following in April 2027, requiring digital records and quarterly updates to HMRC in place of a single annual return. Freelancers in our monthly package are already compliant, because the records are kept digitally as they go and the quarterly updates are submitted from them. Overseas clients, foreign tax withheld, VAT registration timing for freelancers with business versus consumer clients, and the trading allowance for small side incomes alongside employment are all handled as part of the service. Everything is online, the fee is fixed and agreed before you join, and nothing is filed until you have approved it.

Process

From first message to filed

  1. Tell us your situation

    A short message or call about what you do and what needs filing. We ask the questions that determine the right package and nothing more.

  2. Fixed fee in writing

    You receive one price for the work, confirmed by email before anything starts. It does not change if the job takes longer than we expected.

  3. Send records, review the draft

    Records come by WhatsApp or email. We prepare the draft, explain the figures in plain English and answer your questions.

  4. We file, you get the receipts

    Once you approve and the fee is settled, we submit electronically and forward the HMRC or Companies House acknowledgement the same day.

Worth knowing

Rules that come up in this work

The VAT registration threshold

Watching the rolling twelve-month turnover figure is one of the quiet jobs of monthly bookkeeping, because the £90,000 VAT threshold arrives silently. Crossing it brings quarterly returns, Making Tax Digital software and a decision about schemes. Crossing it late brings a bill for VAT you could not recover from customers and a penalty for failing to notify.

Corporation Tax rates and marginal relief

Companies pay Corporation Tax at 19% on profits up to £50,000 and 25% on profits over £250,000. Between those figures marginal relief applies, producing an effective rate that rises gradually and a marginal rate of 26.5% on each pound in the band. The thresholds are divided by the number of associated companies, so a director with two companies has thresholds of £25,000 and £125,000 for each.

Salary versus dividends

Paying yourself from a company involves two routes with different tax treatment. Salary through payroll is a company expense and builds a National Insurance record; dividends come from post-tax profit at lower personal rates. Undocumented drawings that are neither become director's loans, with a 35.75% section 455 charge if not repaid within nine months of the year end.

Director's loan accounts

Money taken from a company has to be something: salary, dividend, expense reimbursement or loan. If it is a loan and remains outstanding nine months after the year end, the company pays tax at the dividend higher rate on it until it is repaid. Clearing the balance with a properly declared dividend before the deadline, where reserves allow, is routine year-end work.

The Self Assessment calendar

Four dates govern Self Assessment: 5 October to register, 31 October for paper returns, 31 January to file online and pay, and 31 July for the second payment on account. Missing the January date triggers an automatic £100 penalty before any tax is even considered, so we treat it as the fixed point around which the rest of the year is planned.

Payments on account

Payments on account catch out most people in their second year of self-employment. HMRC assumes next year's tax will match this year's and collects half in January and half in July, in advance, on top of the balancing payment. If profits are dropping you can apply to reduce them, but reducing them too far attracts interest. We calculate the right figure rather than guessing.

Late filing penalties

Penalties are the clearest reason to work to deadlines. A Self Assessment return one day late costs £100 regardless of whether any tax is due; three months late adds £10 a day. Late company accounts start at £150 and reach £1,500, and double if the previous year was also late. None of this is negotiable afterwards except through a narrow reasonable-excuse appeal.

Questions

Freelancer Accountants: your questions answered

What does the £45 sole trader package include?

Monthly bookkeeping from your bank feed with receipts captured by phone, a monthly summary showing profit and the tax accruing, your Self Assessment with the self-employment pages prepared and filed, payments on account calculated, and deadline tracking. Software is in your name and billed to you separately.

What does the £79 company package include?

Monthly bookkeeping, director payroll with RTI submissions, dividend paperwork, the annual statutory accounts and CT600 filed with Companies House and HMRC, the confirmation statement filed (Companies House £50 fee separate), and deadline tracking. Your personal Self Assessment is added at the published £129 if needed.

Should I be a sole trader or a limited company?

At profits under roughly £30,000 to £40,000 a sole trader is simpler and the tax saving from a company is small after the extra compliance cost. Above that, or where clients prefer to contract with a company or liability is a concern, incorporation can make sense. Our free comparison tool gives a first view and the starter session a definitive one.

What is the annual-only option?

For £229 a year we prepare your year-end accounts and Self Assessment from the records you keep yourself, whether in software or a spreadsheet. It suits freelancers with modest transaction volumes who are organised. If the records arrive as a shoebox, the sole trader accounts shoebox fee applies instead.

How much should I set aside for tax?

For a sole trader, roughly 20% to 30% of profit covers income tax and Class 4 National Insurance at basic rate, more at higher rate, plus payments on account in the first year they apply. We give you a specific monthly figure based on your actual profit each month, which is more useful than a rule of thumb.

What expenses can freelancers claim?

A proportion of home costs for the space and hours you work there, or HMRC's flat rate; equipment and software; professional subscriptions and insurance; training that maintains existing skills; business travel other than commuting; marketing and website costs; bank charges; and the business share of phone and internet. We review your categories every month.

Can I claim for my laptop and camera?

Yes. Equipment used for the business qualifies for capital allowances, usually the annual investment allowance giving full relief in the year of purchase, restricted for private use. Under the cash basis equipment is simply an expense when paid. Items bought before you started can be brought in at market value.

I have a job and freelance on the side. How does that work?

Your employment is taxed through PAYE and your freelance profit is added on top through Self Assessment, usually at your marginal rate. If freelance income is under £1,000 the trading allowance means no return is needed. Above that, register by 5 October after the tax year you started. Our package covers the whole return including the employment pages.

What is the starter session?

A £99 video call before or soon after you go freelance, covering the sole trader versus company decision, registration with HMRC, how to price so that tax is covered, what records to keep and how, invoicing and payment terms, and the dates that matter. You come away with a written plan. If you then join a monthly package the £99 is credited.

Does Making Tax Digital apply to freelancers?

If your gross self-employment plus property income was over £50,000 in 2024/25 you joined MTD for Income Tax in April 2026; over £30,000 means April 2027; over £20,000 is planned for April 2028. It means digital records and quarterly updates. Our monthly package keeps the records in the right form and submits the updates.

How do you handle irregular and overseas income?

Irregular income is normal for freelancers and the monthly summary shows the year-to-date position so lean months are planned for. Overseas clients are invoiced without UK VAT in most cases, and any foreign tax withheld can usually be credited against your UK liability. Both are handled within the package.

Do I need to register for VAT?

Only when your taxable turnover in any rolling 12 months exceeds £90,000, or voluntarily before that. Many freelancers with business clients register voluntarily to reclaim VAT on equipment; those with consumer clients usually wait. We monitor your rolling turnover and advise before the threshold is reached.

Where

Freelancer Accountants across the UK

This service has a local page for the 1,680 larger towns and cities we cover, and is delivered nationally everywhere else. A selection:

England: Central London · East London · East Midlands · East of England · M25 Fringe · North East · North East London · North London · North West · North West London · South East · South East London · South London · South West · South West London · West London · West Midlands · Yorkshire

Scotland: Scotland

Wales: Wales

Northern Ireland: Northern Ireland

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Get freelancer accountants for a fixed fee

Tell us what you need. You get one fixed fee in writing, and nothing is filed until you approve it.

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