Sole trader online accounting software
Embrace Sole Trading with all of the support you need
With software heavily promoted as a must-have, Crunch goes one step further with the power of software and service.
Crunch’s effective software package includes being able to talk to an expert client manager and a Chartered Certified accountant.
You can count on Crunch to make you productive and profitable.
"Five-star service. Been with Crunch for years and the software is intuitive but for any worries, their team is on hand and always very helpful."
"I can assure you that Crunch is professional in its attitude to business but also cares about and supports its clients in any way they can... They definitely went the extra mile for me."
"Without sounding cheesy, Crunch have been invaluable to me during my seven year tenure as a sole director/employee of my ltd Co."
Ease of set up
There is a simplistic three-step process to start out as a Sole Trader in the UK.
- Let HMRC know that you are self-employed
- Register for Self Assessment as a Sole Trader
- Pick a business name
Then you are effectively free to start trading immediately, and there is no need to register with Companies House.
As a Sole Trader you have to keep accurate records of sales and expenses. Operating in this manner is simple because you are only submitting a Self Assessment (and maybe a VAT return).
You do not need to employ the services of a solicitor nor company formation agent. If you choose to use an accountant, their costs can also be cheaper as there are far fewer statutory filings and reporting deadlines.
You also will not have to pay a registration fee to Companies House.
You are protected by HMRC’s taxpayer confidentiality rules as a Sole Trader. With your details kept private, your rivals will have less information about you that makes it more difficult for them to size you up and compete.
Arguably the greatest advantage of being a Sole Trader is the freedom to captain your own ship. There are no shareholders to consult, and the only opinions you need to listen to are yours and perhaps your accountants if you have one. Being a Sole Trader means that all post-tax profits are yours to do with as you please.
Why Software and Service really works?
Crunch undertake the (boring) paperwork
You will need to register with HMRC as a Sole Trader whether it is a side hustle you infrequently enjoy, or something more formal.
Crunch are with you every step of the way
We were the first to innovate the Software and Service model, a revelation in the world of accounting, which includes absolutely everything you need in one place.
We built Crunch Free to help professionals grow their business, without the high costs of accounting software and accountancy fees.
Crunch's Software and Service model delivers features and functions to allow you to take maximum control of your business finances.
What if I receive a letter from HMRC?
Crunch's Client Managers can guide you through our easy-to-use software so feel free to book an appointment. Alternatively refer to our Help Centre and/or training videos.
Ensure you are as tax-efficient as possible
While running a business as a Sole Trader is straightforward, it may not be your most tax-efficient structure. Crunch offers advice on how to set up and run a Limited Company.
Crunch will ensure you can claim every viable business expense to offset the tax you pay. Your Crunch accounting costs can be offset against tax.
At £30,000 profit and above, it is almost certainly more tax efficient to start your own Limited Company. Ask for a free Tax Computation from your expert advisor.
If you have already chosen the Sole Trader product, do check with your Client Manager when will be the right time to upgrade to the Limited Company product so you can save on tax.
If your Sole Trader business is flying and your turnover is around £80,000, then Crunch will check if you want to upgrade to a Limited Company.
If you continue as a Sole Trader, Crunch will register you for VAT. Then the whole VAT system will automatically come to life in your Crunch account.
VAT is automatically added to sales invoices. You will be able to claim VAT on many business expenses.
Crunch’s VAT Checker ensures that there are no mistakes and if there are queries these are passed to our accountancy team to investigate.
What is MTD?
This is HMRC’s initiative called Making Tax Digital.
MTD has been brought in to move businesses away from spreadsheets and get them filing digital returns with HMRC.
We are compliant for MTD VAT and we are preparing for MTD ITSA, which will change how Self Assessments are filed in the future.
Helping hand (should it ever be required)
Crunch covers you should you be working are flat out. We have professional accountants available to go through your bookkeeping.
Our specialist accountants can be there, ready to dive into your bookkeeping, with little notice for just £29.50 per hour.
You can always leave it to our professional bookkeepers for any foreign currency dealings. Crunch's team of experts will quickly have your foreign billings and expenses in an orderly fashion.
Why business owners love us
...I was losing sleep because of accountancy tasks and calculations... I can affirm it's what it says in the box and a bit more...They were so so so helpful and patient in answering my questions and even did a video call to share their screen and show me in detail what they were doing. The advice and guidance is great. It's what makes the difference. Thanks Crunch, for allowing me to sleep now.More
I have been using Crunch Free since May and find the system very easy to use and track the progress of my business, love the professional templates which really make my business look the part. Zoe was very friendly and could answer all my questions whilst guiding me through the processes of setting up a pro account. No pressure was applied and felt very comfortable. Looking forward to progressing my business with the support of Crunch Pro services!More
I was new to the UK when I had to register my company back in 2019 and they have done an amazing job doing everything timely, and answering every single question throughout these years. I have and I continue to highly recommend it to anyone who wishes peace of mind when being a Company DirectorMore
Affordable pay-monthly plans
We believe everything should be easy, so we've built the most intuitive accounting software ever, with real experts at the touch of a button. All in one place.
To see for yourself, book a call with one of our amazingly friendly advisors today!
Unlimited free accountancy & tax software.
- Ideal for sole traders & ltd companies
- Endlessly upgradable
- Free open banking
Starting from £40+VAT
Starting from £16.50+VAT
Starting from £21.50+VAT
Pension Auto Enrolment
Initial set-up fee £300+VAT
Easily connect your Crunch account to a range of helpful business-boosting tools from our trusted collaborators.
Financial forecasting, reporting for cash flow, business planning and budgeting for your business. Get the free plan with all Crunch subscriptions.
Create your own online store for your business with Shopify. Available for all Crunch Limited Company, Sole Trader and Free clients
Accept payments, send payouts, and manage your business online. Free for all Crunch paid subscription users.
Frequently asked questions about Crunch's Sole Trade accounting
What is Sole Trader accounting?
If you run your own business as a sole trader, you’ll need to prepare accounts each year to show your income and expenses. This will enable you to calculate your annual profit and the amount of drawings you can take from your business. You will also be able to calculate the tax you owe to HMRC.
What is a Sole Trader?
If you’re self-employed and running your own business as an individual, then you should be registered with HMRC as a sole trader. Being a sole trader means there’s no legal distinction between the individual and the business they own.
Sole traders work in many industries and trades, including electricians, plumbers, management consultants, designers, and more. Check out our article on “What is a sole trader?” for more information.
Do Sole Traders need an accountant?
As a sole trader, there’s no law that requires you to have an accountant, but an accountant can help you stay on top of your business finances, manage your legal obligations as a small business owner, and help with your statutory filings and tax returns.
An accountant is especially helpful where your sole trade business is starting out and needs assistance with areas such as VAT, CIS, and employing others.
What accounts does a Sole Trader need to file?
Tax returns sole traders are required to file include VAT (if your business is VAT registered), and your annual Self Assessment, which covers your personal Income Tax and National Insurance liabilities. You can read more about your tax obligations in our “What is a sole trader?” article.
How do I file taxes as a Sole Trader?
Sole trader taxes need to be filed with HMRC before their relevant due dates. You’ll need to start by registering as a sole trader with HMRC, and registering for tax returns such as Self Assessment.
As a Crunch client, our team of Chartered Certified accountants can file your tax returns on your behalf. If you don’t have an accountant, though, you’ll need to file your returns yourself.
Who can prepare Sole Trader accounts?
You can prepare your own sole trader accounts if you’d like, but the best strategy is to get an accountant to do it for you. Accountants can make sure your returns are filed accurately and well ahead of a deadline - all you need to do is sign them off! An accountant will also make sure you are claiming the correct business expenses.
When do Sole Trader accounts have to be filed?
Your annual Self Assessment must be filed with HMRC before 31st January each year.
Do I need a business account as a Sole Trader?
As a sole trader, all of your business profit is taxable to you personally, and legally there is no difference between you and your business. But unless you want to pay more tax than necessary, you’ll usually want to claim sole trader business expenses when it comes to submitting your annual Self Assessment tax return. You need to be able to prove your business expenses are allowable. Having your business and personal expenses in the same bank account can cause all sorts of headaches and means getting your accounts ready takes longer than necessary.
With secure Open Banking connections, you can link your business bank account directly to your Crunch account and import all of your transactions in one simple click. From there, reconciling your bank accounts becomes a simple job!
How do I set up a Sole Trader bank account?
Many major banks don’t give you the option to open an account for your small business online, but usually, you’ll be able to start your application on the bank’s website, prior to meeting a representative in person or over the phone.
Some banks will allow you to walk into the branch and make a same-day appointment, but of course, this cannot always be guaranteed.
Crunch is also partnered with a number of trusted banks, including Tide, Metro, Barclays, and Revolut. You can even enjoy special offers and discounts when you open a business account through one of these providers as a Crunch client!
How much is an accountant for a Sole Trader?
At Crunch, our paid accountancy package for sole traders is available for just £24.50+VAT a month! As a Crunch client, you’ll get access to a team of Chartered Certified accountants and expert client managers, available whenever you need them to help your business thrive.
Are Sole Trader accounts viewable through Companies House?
Sole traders don’t need to register with Companies House, so no information about your business will appear in their records or on their website.
Can I claim an accountancy expenses invoice as a Sole Trader?
You can claim expenses for your businesses accountancy fees, providing the accountant's time is being spent working on your sole trader accounts and not on personal items, such as the production of your annual Self Assessment.
Do Sole Trader accounts have to be audited?
It’s unlikely your sole trade business will require an audit unless you begin reporting turnover of millions of pounds. In such cases, you’d need an accountant to guide you through any audit requirements.
How am I taxed on my Sole Trader accounts?
As a sole trader, you pay yourself based on personal drawings from the business, and you pay Income Tax and National Insurance Contributions based on the profits your business makes.
That’s why it’s important to keep a record of any drawings you take from the business to pay yourself. This helps you to keep on top of your accounts and helps when calculating your profits, which you eventually pay tax on. You’ll also need to put some money aside to pay your personal tax bill when you submit your annual Self Assessment.
Crunch boasts over a decade of experience by assisting a plethora of businesses with professional advice and guidance from experts.
Our Knowledge articles, jargon-free business guides, tools and calculators as well as tutorial videos can help answer your questions.
Our free self-employed community, Crunch Chorus, boasts over 71,000 members like you.
Crunch are an ACCA-accredited employer
Our Limited Company accountants have a range of qualifications from the Association of Accounting Technicians (AAT) and the Association of Chartered Certified Accountants (ACCA). Our team follows the bylaws, regulations and ethical guidelines of the ACCA.