6 Simple Tax Year End Checks Every Sole Trader Should Do by 5 April

Written by James Veal

Tax year end for sole traders falls on 5 April, and it is a good moment to get your records in order. The UK tax year does not follow the calendar: it runs from 6 April to 5 April. Doing a little before 5 April makes your Self Assessment return easier, and it helps you avoid surprises when the tax bill arrives.

Here is how I would approach it.

Why 5 April and 6 April both matter

Everything you earned and spent up to and including 5 April belongs in the old tax year. From 6 April, you are in the new one. If you are self-employed, your income and expenses for the year are reported on your Self Assessment return, so where a date falls can decide which year something counts in.

Tax year end for sole traders: a short checklist

• Get your records up to date. Sales, receipts and invoices. My guide to what records you need to keep as a sole trader covers it.
• Check your expenses. Go through the year and make sure you have claimed everything you are entitled to. See what expenses sole traders can claim and working from home expenses.
• Think about the trading allowance. If your income is small, it may be worth knowing how it works: what is the trading allowance?
• Review your mileage. If you use your own vehicle for work, make sure the log is complete. See HMRC mileage rates.
• Check your tax savings. Do you have enough set aside? My suggestion in how to budget for your tax bill is 25 to 30 per cent of income, put away each month in a separate account.
• If you are in Scotland, check how the Scottish rates apply to you. See Scottish tax rates for 2026/27.

Making Tax Digital and the new tax year

Making Tax Digital for Income Tax starts on 6 April 2027 if your gross income from self-employment and property combined was over £30,000 on your 2025/26 Self Assessment return. A lower £20,000 threshold is planned for a later year. Read MTD for Income Tax: the £30,000 threshold and the quarterly deadline schedule to see whether this affects you. HMRC’s own guidance is on GOV.UK. If it does, the end of the tax year is the best time to get your software and records ready.

What is the 31 July payment on account?

Payments on account are advance payments towards next year’s tax bill, on the assumption that your income will be similar. You need to make them unless your bill for the previous year was under £1,000, or you paid more than 80 per cent of your tax outside Self Assessment (for example through your tax code, or because your bank deducted tax from savings interest).

• The first payment on account is due 31 January, along with any balancing payment from the previous year.
• The second payment on account is due 31 July.
• Each payment is half of the previous year’s bill.

For example, if your first-year tax bill is £4,000, you would pay £6,000 in January (the £4,000 plus £2,000) and £2,000 in July.

Many people are caught out by this in their first year, because January feels like one bill and is really two. Read my full guide: what is a payment on account? HMRC also explains how payments on account work. If your income has dropped, you can ask HMRC to reduce your payments, online or by post using form SA303. Be careful with this, though. If you reduce them too far and your bill turns out higher, HMRC charges interest on the difference.

Frequently asked questions

When does the tax year end?

On 5 April. The new tax year starts on 6 April.

When is the second payment on account due?

31 July.

Do I have to make payments on account?

Usually yes, unless your previous year’s bill was under £1,000 or you paid more than 80 per cent of your tax outside Self Assessment.

Can I reduce my payments on account?

Yes, if you expect lower income. You can ask HMRC online (sign in to your account, select your latest return, then “Reduce payments on account”) or by post using form SA303. Take care not to reduce them too far, as HMRC charges interest on any shortfall.

What if I am not sure I am doing it right?

Get in touch. I can go through your records with you.

Need a hand before 5 April?

Have a look at my Self Assessment service or get in touch. Speak to me early. Waiting until January leaves little time to fix anything.

This is general guidance, not personal tax advice. Check HMRC’s current rules or speak to me about your own situation.