When to do it
Not immediately after qualifying. The usual advice — and it is good advice — is to spend two to three years employed after you qualify, getting quick, getting confident, and seeing a wide enough range of jobs that you can price work without guessing.
The trades where self-employment comes soonest are the ones with low tool costs and a direct route to customers: decorating, tiling, barbering, hairdressing, gardening, mobile mechanics. Electrical and gas work take longer, because the certification and insurance requirements are heavier.
Two ways to do it
Subcontracting to other firms. You work on site for a main contractor or a larger trade firm, paid a day rate or on price. Steady work, no marketing, less admin — but you are still working to someone else's programme.
Working direct for customers. Higher rates, more control, but you are now also running a business: quoting, chasing payment, answering the phone, handling complaints. Most people do a mix.
The setup, practically
1. Register as self-employed with HMRC. Do this as soon as you start trading. You will complete a Self Assessment tax return each year.
2. If you work in construction, register for CIS. Under the Construction Industry Scheme, contractors deduct tax from your payments — 20% if registered, 30% if not. Register, or you are lending the government an extra 10% for a year.
3. Get public liability insurance. £1m minimum, £2m or £5m for many contracts. Non-negotiable — one incident without it can end you.
4. Get tool insurance, especially for tools left in a van overnight.
5. Consider professional indemnity if you give advice or design.
6. Open a separate bank account. Not legally required as a sole trader, but it makes the tax return take an afternoon rather than a week.
7. Put tax money aside every month. A rule of thumb is 25-30% of everything that comes in. The first January tax bill destroys more small trade businesses than bad workmanship does.
Pricing, honestly
The most common mistake is pricing off your old hourly wage. As an employee on £20 an hour, your employer was charging perhaps £45-60 an hour for you — covering the van, insurance, holiday, quoting time, tools, sick days and profit. All of that is now yours to cover.
Work out what you need to earn in a year, divide it by the days you can realistically charge for — not 365, and not 250 either, because quoting, admin, chasing invoices and travelling are unpaid — and price from there.
The parts nobody teaches you
- Quoting properly. Written, itemised, with what is excluded. Verbal quotes cause arguments.
- Getting paid. Stage payments for anything over a few days. Deposits for materials. A polite, immediate follow-up the day a payment is late.
- Saying no. To jobs that are too far, too cheap, or for customers who are already difficult at the quoting stage. That instinct is worth developing fast.
- The quiet months. Trades are seasonal. January and February are slow in most of them. Budget for it.
- Pension. Nobody is auto-enrolling you now. Set something up.
Sole trader or limited company?
Start as a sole trader — it is simple and cheap. Consider a limited company when your profits reach a level where it saves meaningful tax, or when clients require it, and take actual accountancy advice at that point rather than advice from a forum or a friend in a different trade.
Last reviewed 25 September 2026.