1. Self-employed sole trader

When you sell your business, you have legal responsibilities to staff you employ. You must also finalise your business’ tax affairs.

Staff

If you have anyone working for you, you must tell them:

  • when and why you’re selling the business
  • about redundancy terms or relocation packages, if necessary

Make sure you don’t breach employees’ rights when a business changes ownership.

Tax return and National Insurance contributions

You must send a Self Assessment tax return by the deadline. You’ll need to put the date you stopped trading on the return.

You can use the online form to tell HMRC that you’ve sold your business. It covers both Self Assessment and National Insurance.

You can also call HMRC’s National Insurance helpline to cancel your Class 2 National Insurance contributions.

HMRC National Insurance self-employed helpline
Telephone: 0300 200 3505
Monday to Friday, 8:30am to 5pm (closed on bank holidays)
Find out about call charges

VAT registration

If you’re registered for VAT, you may be able to transfer the VAT registration number to the new owner.

Tax relief

You may have made a Capital Gain when selling your business (eg the money you get from the sale, or assets from the business that you keep).

If this means you need to pay Capital Gains Tax, you may be able to reduce the amount by claiming Entrepreneurs’ Relief.

There are other reliefs to reduce the amount of Capital Gains Tax that you may be able to claim - HMRC has more information.

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