If you’ve stopped being self-employed you’ll need to let HMRC know so they can de-register you for self-assessment. Find out the steps you need to take to cancel your self-employment and what you need to do about the tax side of things.
Friendly Disclaimer: Whilst I am an accountant, I’m not your accountant. The information in this article is legally correct but it is for guidance and information purposes only. Everyone’s situation is different and unique so you’ll need to use your own best judgement when applying the advice that I give to your situation. If you are unsure or have a question be sure to contact a qualified professional because mistakes can result in penalties.
How to Cancel Your Self-Employment Registration
When you stop self-employment you’ll need to let HMRC know so they can cancel your UTR number and stop expecting tax returns from you. You can de-register either online or by phone, but you have to make sure you complete any outstanding tax returns and pay all the tax you owe.
How to De-Register as Self-Employed Online
The easiest way to let HMRC know you are no longer self-employed is to go online. You can cancel your self-employment online using HMRC’s stopping self-employment form.
Before you start to fill out the form, it will help you to have your UTR number and national insurance number to hand. You’ll also need to tell HMRC the date that you officially want to stop your self-employment on the form.
HMRC is unable to accept a date earlier than 7 days before the date you stopped working for yourself.
How to De-Register as Self-Employed By Phone
You can call HMRC on 0300 200 3310 to let them know you have stopped self-employment and how to cancel your UTR number.
Completing Your Tax Returns
Once you have notified HMRC of the date that you stopped self-employment you need to wrap up your taxes. That means:
- Filing any outstanding tax returns;
- Declaring your self-employed earnings up to the date you de-register as self-employed;
- Pay any outstanding self-employed tax you owe;
HMRC can still have the power to investigate your tax affairs going back six years even once you have cancelled your self-employment. So keep all your business records safe.
An Example of Letting HMRC Know You Are No Longer Self-Employed
Penny registered as self-employed and worked for herself from 1 May 2020 to 31 August 2021. On 1 September 2021, she decides to stop being self-employed and take a full-time job receiving a payslip.
Penny completes the HMRC form to stop self-employment on 22 September 2021. She must make sure she:
- Files a tax return for 2020/21 31 January 2022 declaring her self-employment earnings from 1 May 2020 to 5 April 2021;
- Pay any tax she owes for the 2020/21 tax year as well as anything else that is outstanding from previous tax years;
- Complete a final tax return for the tax year 2021/22 by 31 January 2023 to declare her self-employment income from 6 April 2021 to 31 August 2021;
- Pay any tax she owes for the 2021/222 tax year.
When Penny completes her final tax return for 2021/22, she’ll need to include her earnings from her job in the employment section of the return. She’ll find the information she needs on her P60.
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