Do electricians need an accountant? Honestly, not always at the very start, but most I speak to wish they’d got one sooner than they did.

What Tax Do Self-Employed Electricians Actually Pay?

If you’re a sole trader electrician, you pay Income Tax and National Insurance on your profits, not your turnover. The personal allowance sits at £12,570, so that first slice of profit is tax-free. After that, Income Tax kicks in at 20%, then 40% once you push above £50,270.

On top of Income Tax, you’ll pay Class 4 National Insurance contributions. That’s 6% on profits between £12,570 and £50,270, then 2% on anything above that. These aren’t deducted automatically the way they would be in a PAYE job, so you need to set money aside throughout the year rather than waiting for the Self Assessment deadline in January.

What Expenses Can Electricians Claim Against Tax?

This is usually where electricians find the most money they didn’t know they were leaving on the table. Allowable expenses include test equipment, hand and power tools, consumable materials, your van, PPE, public liability insurance, NICEIC or NAPIT membership fees, certification software, phone and broadband, training costs, and accountancy fees. If you buy significant equipment or tools in a given tax year, the Annual Investment Allowance lets you deduct the full cost against profits in that same year, up to £1,000,000.

For your van, you have two options. You can either claim the HMRC simplified mileage rate of 45p per mile for the first 10,000 business miles (then 25p per mile after that), or you can claim the actual running costs including fuel, insurance, servicing and depreciation. The catch is that you have to pick one method and stick with it for the life of that vehicle, so it’s worth thinking carefully about which one suits your situation before you commit.

What About CIS? How It Affects Electricians on Construction Sites

If you take on work from a contractor on a construction site, you’re likely operating inside the Construction Industry Scheme (CIS). Under CIS, the contractor deducts 20% from the labour portion of your invoice before paying you. That deducted money goes to HMRC on your behalf, and you reclaim it or offset it through your Self Assessment return at year end.

One thing that trips people up: the CIS deduction only applies to the labour element, not to the cost of materials you’ve supplied. So if your invoice shows £800 labour and £400 materials, the contractor deducts 20% from the £800 only. Keeping your labour and materials split clearly on every invoice isn’t just good practice, it directly affects what you get paid each month.

When Does It Actually Make Sense to Bring in an Accountant?

The honest answer is: earlier than most electricians think. The most common situation I see is someone who’s been trading for two or three years, making decent money on paper, but genuinely confused about why there’s nothing left at the end of the month. Usually there’s a mix of things going on: no money set aside for tax, missed expense claims, and no real picture of what the business is actually earning versus what’s flowing through it.

There’s also a deadline coming that will change things for a lot of sole traders. From April 2026, Making Tax Digital for Income Tax (MTD) applies to anyone with self-employment income above £50,000, with the threshold dropping to £30,000 from April 2027. That means quarterly digital record-keeping and submissions, not just one Self Assessment return a year. If you’re not already using accounting software properly, this is the moment to sort it out before it becomes a problem.