Does a Sole Trader Need to Register with Companies House?

The quick answer is no; sole traders don’t register with Companies House in order to become self-employed. In this short article we go over how the sole trader registration process compares to incorporating a limited company.

How do I tell HMRC I’m running a sole trader business?

Sole traders who earn more than the £1,000 Trading Allowance from self-employment or “other miscellaneous activities” need to report their income and pay tax on it by registering for Self Assessment with HMRC.

If you start your business in November 2025:

• Your first tax year is 2025/26
• Your second tax year runs 2026/27

The deadline to register using this example is 5th October 2026.

So sole traders don’t need to worry about Companies House?

Sole traders don’t need to register with Companies House, only those who want to operate as a company need to register. Companies House is the organisation responsible for collating and maintaining information other business structures, such as limited companies and Limited Liability Partnerships (LLPs).

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How do I register a limited company?

If you change your mind and decide that you’d rather operate as a limited company, then you will need to register with Companies House as soon as possible; within three months of starting your business in order to be trading legally.
 

 
In order to incorporate your company you will need to register either online or by post. Online registration tends to be faster (and cheaper), with postal applications typically taking between 8 to 10 days. There’s also a same-day service available for a fee.

Watch our video about incorporating a limited company if you’re already in business as a sole trader.

After registering, you’ll receive a Certificate of Incorporation which confirms your company legally exists. It will also show your company number and the date of formation, both of which will be important when you file your tax returns – so keep it safe.

Which one should I use?

Deciding whether to be a sole trader or open a limited company is usually one of the first major business decisions startups will make.

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It’s a very personal decision and will usually depend on lots of variable factors such as how much you earn, where from, and what type of industry you work in, so it’s well worth taking a look through the article we link to above, or having a chat with your accountant.

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