No law says a sole trader needs an accountant. You can register, keep your records and file your own Self Assessment return. Many sole traders with one simple income stream do exactly that.
But some changes make an accountant worth paying for. Going over the Making Tax Digital limit is one. Registering for VAT or taking on staff are others. This guide gives you a simple test, then shows what an accountant actually does for a sole trader.
Disclaimer: This article gives general information. It’s not tax or financial advice. Speak to a qualified accountant about your own situation.
Quick Answer
You don’t legally need an accountant as a sole trader. You can manage alone if your income is simple, your records are tidy and you’re comfortable with HMRC’s online return. Get one when your income passes the Making Tax Digital limit. The same goes when you register for VAT, hire staff or hear from HMRC.
Is a Sole Trader Legally Required to Have an Accountant?
No. The law puts the duty on you, not on an accountant. You must register for Self Assessment once you earn over £1,000 in a tax year. You must keep records and file a return each year. You can do all of it yourself.
GOV.UK sets out what you must do when you set up as a sole trader. There’s no rule that a professional must sign your return.
The duty stays yours even if you hire someone. If your accountant files late or gets a figure wrong, HMRC still sends the penalty to you.
Not sure you need to file at all? Check who has to file a Self Assessment return first.
When Can a Sole Trader Manage Without an Accountant?
If your business is simple, you can do it yourself. That means one type of work, income under the Making Tax Digital limit, no staff, no VAT and no rent. You keep records every month. You know which expenses you can claim. You file before the 31 January deadline every year.
Use this checklist. If every line is true, filing yourself is realistic:
- one business, with income under the Making Tax Digital limit
- no employees and no VAT registration
- no rental income or overseas income
- records kept every month, not in January
- you understand which costs are allowable
- you’ve never had a letter from HMRC asking questions
Even then, watch the deadlines. File late and HMRC charges £100 straight away. After three months it adds £10 a day, up to £900. HMRC’s page on late filing penalties lists the later charges too.
When Should a Sole Trader Get an Accountant?
Get one when your tax affairs stop being simple. Crossing the Making Tax Digital limit is the first sign. Registering for VAT or hiring your first employee are others. So are rental income, plans for a limited company and letters from HMRC. Each one adds rules and deadlines.
Making Tax Digital. Sole traders with qualifying income over £50,000 joined Making Tax Digital for Income Tax from 6 April 2026. The limit drops to £30,000 in April 2027 and £20,000 in April 2028. That means software and four updates a year.
VAT. Once your taxable turnover passes £90,000 in 12 months, you must register. That adds quarterly VAT returns.
Your first employee. Payroll runs every payday, with reports to HMRC each time. You must also set up a workplace pension.
Rental income. Property income has its own rules and its own expenses.
A limited company. Switching structure is a tax decision. Get the numbers checked first.
A letter from HMRC. A compliance check needs a careful reply. Get help before you reply.
What Does an Accountant Do for a Sole Trader?
An accountant prepares and files your Self Assessment return, checks your expenses and works out your tax bill early. They also handle Making Tax Digital updates, VAT returns and payroll if you need them. They deal with HMRC for you, and tell you when a limited company would save money.
An accountant helps most in three ways:
- Expenses. Many sole traders miss costs they could claim, or claim costs they can’t. Both cost money.
- Planning. It’s better to know your tax bill in October than in January. If your tax bill is over £1,000, payments on account can make your first January bill 50% bigger.
- HMRC. An accountant can act as your agent. HMRC can then deal with them directly.
Our accounting help for sole traders also covers your records. We set up your software and check your books through the year.
Is an Accountant Worth the Fee for a Sole Trader?
It’s worth it when the accountant saves you more than they cost, in tax, penalties or time. Count your own hours on your tax return. Add any expenses you weren’t sure about. Compare that with a fixed yearly fee. For many busy sole traders, the fee costs less than their time.
Most people forget to count their time. Ten hours on your return at £30 an hour is £300 of your time. And that’s before any mistakes.
Fees vary with how complex your affairs are. Our guide to how much an accountant costs shows typical UK prices for sole traders.
Deciding for Yourself
Run the checklist above. If every line is true, you can file yourself. If one or more is false, an accountant will usually save you time, stress and money.
DASA’s accountants for sole traders handle your Self Assessment, Making Tax Digital updates and HMRC letters for a fixed fee. Tell us what you do and roughly what you earn. We’ll confirm which plan fits.
This article gives general information about accountancy for UK sole traders. HMRC set these limits and penalties for the 2026 to 2027 tax year. Sole traders in Making Tax Digital move to a points-based penalty system. It’s not tax or financial advice. Speak to a qualified accountant about your own situation.
Last reviewed October 2026 by Raqeeb Marzook, ACCA.
Frequently Asked Questions
Does a sole trader legally need an accountant?
No. A sole trader can register for Self Assessment, keep records and file their own return. The duty stays with you even if you hire an accountant.
When should a sole trader get an accountant?
When you cross the Making Tax Digital limit, register for VAT, hire staff, add rental income, consider a limited company or get a letter from HMRC.
What is the penalty for filing Self Assessment late?
£100 straight away. After three months, £10 a day up to £900, then more at six and twelve months. Sole traders in Making Tax Digital move to penalty points.
What does an accountant do for a sole trader?
Prepares and files your return, checks your expenses, works out your tax early, handles Making Tax Digital and VAT, and deals with HMRC.
Is an accountant worth it for a sole trader?
When they save more than they cost in tax, penalties or time. Count your own hours on the return before you decide.