How to Start a Trade Business in the UK 2026

Starting a trade business in the UK is one of the most achievable paths to self-employment available. If you have a skill — plumbing, electrical work, joinery, decorating, tiling, heating — you already have the foundation. What you need is a clear plan for turning that skill into a properly run business.

This guide walks you through exactly how to start a trade business in the UK — from registering with HMRC and getting the right insurance to pricing your work, finding your first customers, and setting up the systems that will keep your business running smoothly from day one.

Step 1: Decide on Your Business Structure

Before you do anything else, you need to decide how you're going to operate your business legally. For most tradespeople starting out, there are two main options.

Sole trader
The simplest structure. You operate as an individual, register with HMRC as self-employed, and complete a Self Assessment tax return each year. You keep all the profits but you're personally liable for any business debts. The vast majority of tradespeople starting out operate as sole traders.

Limited company
You set up a separate legal entity — your company — and operate through it. More complex to set up and administer, but offers limited liability protection and can be more tax-efficient once you're earning above a certain threshold. Most tradespeople move to a limited company structure once their earnings reach around £30,000–£40,000 per year — speak to an accountant about when it makes sense for your situation.

For most people reading this guide, starting as a sole trader is the right move. It's quick, simple, and costs nothing to set up.

Step 2: Register With HMRC

As a sole trader, you must register with HMRC as self-employed. You need to do this by 5th October in the second tax year of your business — so if you start trading in the 2025/26 tax year, you must be registered by 5th October 2026.

Don't leave it that late. Register as soon as you start trading — it takes minutes online and means you're set up properly from day one.

How to register:

• Go to gov.uk and search for "register as self-employed"
• Create a Government Gateway account if you don't already have one
• Complete the registration — you'll need your National Insurance number
• HMRC will send you your Unique Taxpayer Reference (UTR) number in the post within 10 working days

Once registered, you'll need to complete a Self Assessment tax return each year by 31st January, paying any tax owed at the same time. We cover this in detail in our guide to Self Assessment tax returns for tradespeople.

Step 3: Get the Right Insurance

Before you take on your first job, you need to have the right insurance in place. Operating without insurance exposes you to significant financial risk — and many customers and contractors won't hire you without proof of cover.

Public liability insurance
Essential for every tradesperson. Covers you if a customer or member of the public is injured or their property is damaged as a result of your work. Most customers will ask to see your public liability certificate before you start work. Cover starts from around £50–£100 per year for lower-risk trades.

Tools insurance
Covers the cost of replacing your tools if they're stolen, lost, or damaged. For a tradesperson whose tools represent thousands of pounds of investment, this is important cover to have from day one.

Van insurance
If you're using a van for work, make sure your policy covers business use. Standard personal car insurance policies typically don't cover commercial use — check your policy carefully.

Employers liability insurance
If you take on any staff — even a casual labourer for a day — employers liability insurance is a legal requirement. It covers claims from employees who are injured or become ill as a result of working for you.

Simply Business is one of the best places to compare tradesman insurance quotes in the UK — you can compare multiple providers in one place and get covered quickly online.

Step 4: Get Any Required Certifications and Accreditations

Depending on your trade, you may need specific certifications or accreditations before you can legally carry out certain types of work.

Electrical work
Electricians carrying out notifiable work in England and Wales need to be registered with a competent person scheme — most commonly NICEIC or NAPIT. Without registration, all notifiable work must be certified by the local building control authority.

Gas work
Any tradesperson working on gas appliances must be Gas Safe registered. This is a legal requirement — it is illegal to work on gas appliances without Gas Safe registration.

Plumbing
No mandatory certification for general plumbing — but membership of CIPHE or registration with an approved contractor scheme adds credibility and can open doors to certain contract work.

Building work
No mandatory certification for general building work, but FMB (Federation of Master Builders) membership, TrustMark registration, and CSCS cards are widely recognised and expected on many sites.

Check the requirements for your specific trade before you start taking on work. Operating without required certifications is illegal in some cases and can invalidate your insurance in others.

Step 5: Set Up Your Business Finances

Getting your finances set up properly from day one saves a lot of pain later. The key steps are straightforward.

Open a dedicated business bank account
Keep your business and personal finances completely separate from the start. Starling Bank offers a free business account that's excellent for sole traders — it integrates with accounting software and gives you a clear picture of your business finances at all times.

Set up accounting software
Track your income and expenses properly from day one. Xero and QuickBooks are the most popular options for UK tradespeople — both connect to your bank account automatically and make Self Assessment significantly less painful. Start using one as soon as you start trading.

Set aside money for tax
As a self-employed tradesperson, you're responsible for your own tax. A simple rule of thumb is to set aside 25–30% of every payment you receive into a separate savings account for tax and National Insurance. Do this from your very first invoice — the tax bill will come eventually and it's much easier to manage if you've been saving throughout the year.

Register for VAT if needed
You must register for VAT once your taxable turnover exceeds £90,000 in a 12-month period. Below that threshold, VAT registration is optional — though some tradespeople choose to register voluntarily. Speak to an accountant about whether voluntary registration makes sense for your situation.

Step 6: Sort Your Pricing

One of the most common mistakes new tradespeople make is undercharging. It feels safer to price low when you're starting out — but undercharging is one of the fastest ways to run a struggling business.

Your pricing needs to cover:

• Your labour — what you need to earn per hour to make the business viable
• Materials — at cost price plus a reasonable markup
• Overheads — van costs, insurance, tools, software subscriptions, fuel
• Tax — remember you're paying your own National Insurance and income tax
• Profit — the business needs to generate profit above your personal drawings to be sustainable

Research what other tradespeople in your area are charging for similar work. Price competitively — but don't undercut to the point where you're not making a proper living. Customers who choose purely on price are rarely the best customers to work for.

We cover pricing in detail in our guide to how to price a job as a tradesperson.

Step 7: Get Your First Customers

When you're starting out, getting those first customers is the priority. Here are the most effective ways to generate work quickly as a new tradesperson.

Tell everyone you know
Word of mouth is still the most powerful marketing tool in the trades. Tell friends, family, former colleagues, and neighbours that you've gone self-employed. Ask them to spread the word. Your first several jobs will almost certainly come from people you know or their connections.

Set up a Google Business Profile
A free Google Business Profile puts you on Google Maps and in local search results — so customers searching for your trade in your area can find you. Set it up properly with photos, your services, and opening hours. We cover this in detail in our guide to setting up a Google Business Profile for a trade business.

List on Checkatrade or Rated People
Trade directories connect you directly with homeowners who are actively looking to hire. A listing on Checkatrade or Rated People can generate leads quickly while your organic presence builds.

Get your first reviews
Ask every customer to leave you a Google review as soon as the job is complete. Even five or six reviews early on gives you credibility that helps convert future enquiries.

Create a simple Facebook business page
Post before and after photos of your work. Join local community groups and respond to requests for tradesperson recommendations. A consistent Facebook presence generates local leads at zero cost.

Step 8: Set Up Your Job Management System

When you're just starting out with one or two jobs a week, managing everything in your head or on a notepad might seem fine. But as your business grows, that approach breaks down fast — missed follow-ups, forgotten invoices, and unprofessional quotes cost you money and reputation.

Setting up a proper job management system from day one means you build good habits early and never have to unpick a chaotic system later.

Tradify is the best job management platform for UK tradespeople starting out. It handles quoting, job scheduling, invoicing, and payment chasing all in one place — and it's designed to be simple enough to use from your phone on site. You can send a professional quote within minutes of assessing a job and convert it to an invoice the moment the work is complete.

Try Tradify Free — No Card Required

Step 9: Build Your Reputation

In the trades, your reputation is everything. The businesses that grow fastest aren't always the most skilled — they're the ones who show up on time, communicate clearly, do what they said they would, and follow up after the job.

Simple habits that build a strong reputation quickly:

• Always show up on time — or call ahead if you're going to be late
• Send professional quotes promptly — ideally the same day as the assessment
• Keep customers updated on job progress
• Leave the work area clean and tidy
• Follow up after every job to make sure the customer is happy
• Ask for a Google review from every satisfied customer

These things sound basic — but the majority of tradespeople don't do all of them consistently. The ones who do stand out immediately and generate significantly more referrals and repeat work.

The Bottom Line

Starting a trade business in the UK is genuinely achievable — and for skilled tradespeople, it can be extremely rewarding both financially and in terms of independence and flexibility.

The key steps are simple: register with HMRC, get your insurance in place, sort your pricing, start telling people you're open for business, and set up the systems that will keep everything running smoothly as you grow.

The tradespeople who succeed aren't necessarily the most technically skilled — they're the ones who run their business professionally from day one. Get the right tools in place early and you'll be ahead of the majority of your competition before you've even finished your first month.

Try Tradify Free — No Card Required

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