Debt Help for Self Employed
Being self employed comes with unique challenges. Irregular income, tax bills, and mixing business with personal finances can lead to debt problems. The good news is that debt solutions like IVAs and DMPs work for self employed people, freelancers, and sole traders.
We Understand Self Employment
Variable income accepted
Payments based on your average, not your best month
Tax debts included
HMRC, VAT, and self assessment can all be covered
Keep working
Continue your business while managing debt
Stop creditor pressure
Legal protection from HMRC and other creditors
The Challenges of Self Employed Debt
Self employment has unique pressures that can lead to debt. You are not alone in facing these challenges.
Irregular income
Feast or famine months make budgeting difficult. Good periods can be followed by quiet spells.
Tax debt builds up
Without PAYE, tax bills can come as a shock. Many self employed people fall behind on self assessment.
No sick pay
Illness or injury means no income. Debts can spiral when you cannot work.
Business and personal mixed
As a sole trader, personal and business debts combine. Credit cards get used for business expenses.
Late payments from clients
Waiting for invoices to be paid while your own bills are due creates cash flow problems.
Business investment
Borrowing to invest in your business does not always pay off. Equipment, stock, and marketing add up.
Debt Solutions for Self Employed
These solutions are designed to work with the realities of self employment.
IVA for Self Employed
A legally binding agreement where you pay what you can afford for 60 months. Remaining debt is written off.
- Continue running your business
- Include tax debt and business debts
- Payments based on average income
- Legal protection from creditors
- Remaining debt written off
Debt Management Plan
An informal arrangement with reduced payments. Flexible and can adjust to your income changes.
- Payments can vary with income
- No formal insolvency record
- Continue trading freely
- We deal with creditors for you
- Leave anytime if finances improve
Time to Pay with HMRC
If your main debt is tax, HMRC may agree a Time to Pay arrangement for you to clear arrears over time.
- Spread tax payments over months
- Avoid penalties and enforcement
- Keep your business running
- Direct arrangement with HMRC
Eligibility:
Tax debt only, ability to make regular payments
How We Calculate Your Payment
We understand that self employed income varies month to month. That is why your payment is based on an average, not your best or worst month. Here is how the process works.
Start your assessmentGather financial records
Bank statements, tax returns, invoices, and expense records from the last 6 to 12 months
Calculate average income
Your income is averaged over several months to account for fluctuations
Assess essential expenses
Business costs, living expenses, and other necessary outgoings are calculated
Determine affordable payment
The difference between average income and expenses becomes your payment
What Debts Can Be Included?
Most personal and business debts can be included in an IVA or managed through a DMP.
How it works
Getting help is easier than you think. Here is what happens when you get in touch with us.
Have a chat with us
Call us or fill in the form. We will listen to what is going on and explain your options in plain English. No pressure, just help.
We look at your situation
We will work out what money is coming in, what is going out, and what you owe. This helps us find the best way to help you.
We sort everything out
Once you decide what to do, we handle all the paperwork and talk to the companies you owe money to. You do not have to do this yourself.
Get debt free
You make one payment each month that you can afford. Your debt goes down, and eventually, you are free of it. A fresh start.
Ready to take the first step?
Check If You QualifySelf Employed People We Have Helped
Real stories from freelancers, contractors, and sole traders who found debt solutions that worked for them.
"As a self employed electrician, my income goes up and down. I thought I would not qualify for an IVA but they worked with my average income. Now half my debt including tax arrears will be written off."
Gary P.
Bristol
Result
£18k debt including HMRC
"I am a freelance designer and got into trouble with tax. The IVA included all my HMRC debt and credit cards. I can still take on clients and work normally while making one affordable payment."
Sarah L.
Newcastle
Result
Still working freelance
"Running a small business, cash flow got on top of me. The DMP let me reduce my payments and adjust them when I had quiet months. It was the flexibility I needed as a sole trader."
Marcus T.
London
Result
Flexible payments arranged
Self Employed Debt Questions
Common questions from freelancers, contractors, and sole traders about debt solutions.
Our advisors understand the unique challenges of self employment. Get tailored advice for your situation.
Get Free AdviceCan I get an IVA if I am self employed?
Yes, self employed people can get an IVA. The process is similar to employed people, but your income is assessed based on your business accounts, bank statements, and tax returns. Irregular income is not a barrier as long as you can demonstrate an average income that supports monthly payments of around £100 or more.
How does an IVA work for self employed?
An IVA for self employed works the same as for anyone else. You make affordable monthly payments for 60 months, then remaining debt is written off. The difference is how your income is calculated. Your Insolvency Practitioner will review your business income and expenses to determine what you can afford.
What if my income is irregular?
Irregular income is common for self employed people and is not a problem. Your payments can be based on an average of your income over several months. Some IVAs also allow for variable payments where you pay more in good months and less in quieter periods, as long as you meet an agreed minimum.
Can I include tax debt in an IVA?
Yes, HMRC debts including self assessment tax, VAT arrears, and National Insurance can be included in an IVA. HMRC is treated like any other creditor. Many self employed people enter IVAs specifically because they have built up tax debts they cannot afford to pay.
Will an IVA affect my business?
An IVA is a personal insolvency procedure, not a business one. If you are a sole trader, there is no separation between you and your business, so the IVA covers your personal debts including business debts. You can usually continue trading, but you cannot obtain credit over £500 without permission.
What happens to my business if I get an IVA?
As a sole trader or freelancer, you can typically continue running your business during an IVA. The business itself is not affected unless it has significant assets. You can continue working with clients, invoicing, and operating normally. The IVA simply manages your debt repayment.
Can sole traders get debt help?
Yes, sole traders have access to the same debt solutions as anyone else: IVAs, Debt Management Plans, Debt Relief Orders, and bankruptcy. The best option depends on your debt level, income, and whether you want to continue trading. Free advice can help you understand which solution suits your situation.
Is there debt management for self employed?
Yes, Debt Management Plans are available for self employed people. Your DMP provider will negotiate with creditors to reduce your monthly payments based on what you can afford. This is particularly suitable if you want flexibility or have variable income, as payments can be adjusted as your income changes.
Get Debt Help That Works for You
Self employed? Freelancer? Sole trader? We have solutions that work with irregular income, include tax debts, and let you keep running your business. Our free assessment takes just 2 minutes.
Check your optionsFree, confidential, no obligation