How to tell HMRC you have stopped being self-employed
Close your self-employment properly — tell HMRC, file the final return, settle what's left, and stop future bills before they start.
Last checked 22 August 2026
Before you start
Have these ready and the wind-down is mostly form-filling.
Your Government Gateway sign-in and UTR.
The date you stopped trading.
Your records up to the stop date — sales, expenses, and any equipment
you kept or sold.
Tell HMRC you've stopped
Use HMRC's online service to report the date you stopped
self-employment. This is what switches off future returns and Class 2
National Insurance records — filing a final return alone doesn't do it.
Tell HMRC on GOV.UK →Good to know
Do the same for a partnership: the nominated partner reports the
partnership stopping, and each partner reports leaving.
File a final Self Assessment return
You still file for the tax year you stopped in, showing income and
expenses up to the stop date and the cessation date itself. The
deadline is the normal one — 31 January after the end of the tax year,
filing online.
Deadline
31 January 2027, for a business that stopped during the tax year
ending 5 April 2026.
Deal with equipment and stock
Anything you claimed capital allowances on and then keep or sell can
produce a balancing adjustment in the final accounts — effectively
returning some of the allowance if the item is still worth something.
Stock you keep for yourself counts as taken at market value.
Check your National Insurance position
Class 4 National Insurance is worked out on the final return as usual.
Class 2 hasn't been compulsory since April 2024, but if your profits
are low, check your State Pension record — a voluntary Class 2 top-up
for the final year can protect a qualifying year cheaply.
Close the other registrations that depend on trading
If you're VAT-registered, cancel the registration and file a final VAT
return. If you employ people, close the PAYE scheme after the final
payroll. Neither happens automatically when the self-employment ends.
Settle up and keep the records
Any balancing payment stays due on the normal dates — and if you've
already made payments on account for a year with little or no profit,
ask to reduce them or claim the refund. Keep your business records for
at least five years after the 31 January filing deadline.
Common questions
Stopping, in practice
Do I need to file a return next year as well?
Only if something else keeps you in Self Assessment — rental income,
dividends, or another untaxed source. Otherwise, once the final return
is in and HMRC has the stop date, the notices stop.
I made a loss in my last year — is it wasted?
Not necessarily. Terminal loss relief lets a loss from the final twelve
months be carried back against the profits of the previous three tax
years, which can produce a repayment.
What if I start trading again later?
Register again with the CWF1 route, quoting the UTR you already have.
Your UTR never expires — you pick up the same record.
I'm switching to a limited company, not stopping — same process?
Yes, for the sole-trade side: the self-employment ends and everything
above applies, while the company registers separately for Corporation
Tax and, usually, PAYE.
Related guides
Loose ends that usually go with stopping.
How to pay your Self Assessment tax bill
The ways to pay, how long each one takes to reach HMRC, and the dates your balancing payment and payments on account fall due.Read the guide →
How to register for Corporation Tax
The three-month window after your company starts doing business, what to register with, and the filing and payment dates that start running.Read the guide →
Wind down with the records already in order.
Bookfolio keeps your final year's income and expenses tidy up to the day you stop, so the last return is a review, not an excavation.