Every autumn the same ritual plays out. The Budget lands, something in it lands badly on the self-employed, and the trade press fills with people explaining why the Treasury clearly does not understand how small businesses work. The complaint is often correct. What almost nobody mentions is that the Treasury spent the preceding weeks openly asking to be told, and hardly anyone outside the accountancy bodies wrote in.

That window is open right now. The Autumn Budget is confirmed for Wednesday 28 October 2026, and HM Treasury is accepting Budget representations through its online portal until 23:59 on Wednesday 9 September. Late submissions are not considered in the formal process. That gives you under two weeks.

This is not a petition, a vote, or a suggestion box, and it comes with no right to a reply. It is the structured route by which businesses and their representatives put evidence in front of the officials who design tax measures. Whether it is worth your evening depends entirely on what you send, so here is what the process actually is and what makes a submission usable.

Who can submit, and does a one-person business count?

The route is designed for organisations: businesses of any size, trade associations, professional bodies, charities and other stakeholders with evidence on a tax, spending or regulatory issue. A sole trader or a single limited company can absolutely submit, and the portal does not turn you away for being small.

Be realistic about weight, though. A trade body arrives carrying survey data across thousands of members and can quantify the effect on jobs and investment. You arrive with one business. That does not make your submission worthless, but it does dictate the strategy: one narrow, specific, evidenced point beats a broad complaint every time, and if a body already represents your sector, feeding your numbers to them can carry further than going alone.

What the process actually involves

There is no published word limit for the portal, so ignore anyone who tells you there is a Treasury-mandated page count. What matters far more is shape. A representation is a technical policy brief, not an opinion piece, and the ones officials can use tend to carry the same components: a one-page executive case naming the precise change requested, a clear definition of the problem in practice, a specific proposed design rather than a grievance, an estimate of what it would cost the Exchequer and who would take it up, the evidence behind all of that, and a named contact who can answer a follow-up question.

Be honest about what it can and cannot do

Nobody should submit expecting to move a headline tax rate. Representations rarely change whether a measure happens; the political and fiscal decisions sit above them. What they genuinely do influence is the layer underneath: thresholds, definitions, eligibility, transitional rules, anti-avoidance carve-outs and commencement dates. That layer is where most of the real-world pain in tax policy lives.

The Treasury also almost never confirms that a particular submission caused a particular change, so proving impact is close to impossible. The honest framing is that a strong representation puts a problem on the list of live options and improves the odds that a measure is designed by someone who has read a real example of it going wrong.

What is actually worth writing about this year

Two things sitting in the current news give the self-employed unusually concrete material.

The first is Making Tax Digital. Figures reported on 26 August show that just over 436,000 sole traders and landlords filed by the first quarterly deadline on 7 August, against an estimated mandatory first cohort of around 864,000, with 570,000 signed up. Roughly half the people who were supposed to file did not. Whatever the mix of causes, a gap that size on a flagship digital programme is the kind of thing the Treasury needs evidence about, and anyone who lived through that first quarter has first-hand material. We wrote about what missing that first deadline actually costs when the numbers were still fresh.

The second is a proposal for a new criminal offence covering reckless untrue statements in relation to direct tax, which drew broad opposition from tax and accountancy bodies in late August. For sole traders who file their own returns without an adviser, where the line falls between an honest mistake and recklessness is not an abstract question.

There is also the perennial one: how income is defined and measured for people who do not draw a salary. The gap between what a business actually earns and the figure the rules produce is the root of an enormous amount of unfairness, from tax to borrowing, as we set out in why doing your accounts properly can shrink your mortgage.

Why this particular Budget is worth the effort

Every pre-Budget window matters a bit. This one matters more than usual, because the fiscal backdrop is tight and tight budgets are where small, badly designed measures get waved through.

The Debt Management Office’s annual review, published on 21 August, recorded £303.9bn of gilts sold in 2025-26 against a £303.7bn plan, with the net financing requirement finishing at £304.6bn. Three days later the Institute for Fiscal Studies was reported warning that persistent inflation could add around £1.7bn to the benefits bill alone, and roughly £4.7bn to £5bn once public service pensions and debt interest are counted. None of that is a decision, and none of it means a specific tax is going up. What it means is that the Treasury is looking for revenue and for savings, and measures aimed at small amounts of money from large numbers of people become more attractive in exactly that environment.

Those are the measures where design detail decides whether something is a mild irritation or a genuine problem, and design detail is the one thing representations reliably influence. A threshold set £5,000 too low, a commencement date that lands mid-tax-year, a definition that accidentally catches part-time traders: all of that is fixable at the drafting stage and close to unfixable afterwards.

Frequently asked questions

Do I get a response if I submit? No guarantee at all. Some submissions lead to further engagement with officials, most are read and noted, and many receive nothing. Treat a reply as a bonus rather than the point.

Is it worth submitting as a business of one? Yes, if you have one specific evidenced point rather than a general complaint. A worked example from a real business, with real numbers, is exactly the sort of detail policy teams lack. A paragraph saying taxes are too high is not.

Can I still influence things after 9 September? The formal Budget process closes then, but the wider policy conversation does not. Consultations on individual measures run all year, and Finance Bill scrutiny continues after the Budget. The 9 September date is the one that gets you into the pre-Budget window specifically.

Where do I find the portal? It is published on the GOV.UK Autumn Budget 2026 pages. Go via GOV.UK rather than a link in an email, since Budget season reliably brings a wave of phishing aimed at the self-employed.

The reason so few small businesses submit is not apathy. It is that most people never learn the window exists, and by the time the Budget makes the news the door has been shut for seven weeks. It is open now, it closes on 9 September, and the entire cost of finding out whether your evidence matters is one carefully written page.

The first real Making Tax Digital deadline has been and gone. The quarter covering 6 April to 5 July 2026 had to be filed by 7 August, and HMRC expected roughly 436,000 sole traders and landlords to file it. Judging by the number of panicked searches since, a fair chunk of them did not.

So here is the answer to the question everyone is typing: if you missed the 7 August quarterly update, the penalty is nothing. No fine, no penalty points, no letter. HMRC has confirmed that no late-submission penalty points will be issued for quarterly updates in 2026/27, the first year of the new system. You should still file the update as soon as possible, but you have not been fined.

That is the good news. The rest of this piece is about why relaxing now would be a mistake, because the easement is narrower than it sounds, it expires in April, and the habits you build this year decide whether MTD becomes a minor admin rhythm or a quarterly panic for the rest of your trading life.

Who is actually inside MTD right now?

Making Tax Digital for Income Tax became mandatory on 6 April 2026 for sole traders and landlords whose qualifying income was over £50,000. Qualifying income means your combined gross income from self-employment and property, before expenses and before tax. It is not profit, and it does not include PAYE wages, pensions, dividends or savings interest.

That gross-not-profit detail catches people out constantly. A landlord with £52,000 of rent and £30,000 of costs is inside MTD. A sole trader flat out certain they are under the line because their taxable profit is £35,000 may well be inside it too. If you covered our piece on why the taxable income on your accounts is not the number you think it is, this is the same lesson from the other direction: HMRC uses the figure the rules specify, not the one that feels intuitive.

The rollout also does not stop with this year’s wave:

If your 2025/26 gross self-employment and property income lands over £30,000, your version of this article is eight months away.

The 2026/27 deadlines still to come

Quarterly updates follow a fixed rhythm: the 7th of the month following each quarter end. For this tax year, one is done and three remain.

The final MTD tax return for 2026/27, which replaces the old self assessment return, is due by 31 January 2028, along with the tax itself. And here is the catch hiding inside the easement: you cannot file that final return until all four quarterly updates have been submitted. Skip the quarterlies all year and nothing happens, right up until the moment everything happens at once, in January, with a filing deadline that does carry penalties.

What penalties still exist this year?

The easement covers exactly one thing: late quarterly updates in 2026/27. Two other clocks are still ticking.

Miss the 31 January 2028 final return and you collect a late-submission penalty point. The new system is points-based: four points triggers a £200 fine, and every further miss at that threshold is another £200. Points normally expire after 24 months of good behaviour, but once you hit the threshold you need a full year of on-time filing to reset.

Pay the tax late and a separate regime applies. In your first year there is a concession if you pay or agree a Time to Pay arrangement within 30 days of the due date. Beyond that, the charges stack: 3% of what was outstanding at day 15, another 3% of what remains at day 30, then a daily charge at an annualised 10% from day 31 onwards. Late-payment interest runs from day one regardless of any concession. The one-year kindness on quarterly updates does not extend to the money.

The real cost of missing quarterlies is not the penalty

Nobody builds a quarterly bookkeeping habit in January. The people who sail through MTD are the ones treating 2026/27 as the practice year it is designed to be: software connected, receipts captured monthly, an hour per quarter to review and submit. The people who suffer are the ones who interpret “no penalties” as “does not matter” and then have to reconstruct twelve months of records during the worst month of the year, with a final return blocked behind four unfiled updates.

There is also an upside that gets no airtime. Quarterly updates force a running view of your actual profit, which most sole traders have never had. That number is worth having for its own sake: it tells you your tax bill before it arrives, and it is exactly the kind of clean, current record that helps when a lender, landlord or anyone else wants to judge your income from your paperwork. MTD was imposed on the self-employed as a compliance exercise. Used properly, it quietly fixes the record-keeping problem that costs them far more than tax fines ever did.

Frequently asked questions

I missed the 7 August update. Should I file it now or wait for Q2? File it now. There is no fine either way this year, but updates are cumulative and your final return stays blocked until all four are in. Clearing it while the records are fresh takes an hour; reconstructing it in January will not.

Does the penalty easement continue into 2027/28? No. HMRC has described it as a one-year arrangement for the first mandated group. From April 2027 the points system is expected to apply to quarterly updates, at which point repeated misses become £200 fines.

My income is under £50,000. Can I ignore MTD? For now. But the threshold falls to £30,000 in April 2027 and £20,000 in April 2028, measured on gross income, not profit. Most established sole traders and landlords will be inside the system within two years.

Do I need an accountant for MTD? No, but you need MTD-compatible software; spreadsheets alone no longer cut it unless bridged. Many sole traders run the quarterlies themselves and keep an accountant for the final return, which is a sensible split of cost and risk.

The first deadline of a new tax regime is a strange thing: it arrived with years of warning and still caught hundreds of thousands of people out. If that was you, take the free pass, file the update, and use the eleven penalty-free months left to make the habit boring. Boring is the whole aim. The self-employed people who do worst out of MTD will not be the ones who missed 7 August. They will be the ones still improvising in January 2028.

There is a conversation that happens in January and a conversation that happens in June, and most self-employed people never realise they are the same conversation.

In January, your accountant does what you pay them to do. Every allowable expense claimed, capital allowances used, salary kept low, dividends kept sensible, profit left in the company where the tax man cannot reach it. You sign the return, admire the tax bill, and feel like a grown-up.

In June, you sit in front of a mortgage lender, and the lender asks for the very document that tax efficiency produced: the SA302. That form summarises your declared taxable income for the year, and it is the number most lenders will use to decide how much you can borrow. Not your turnover. Not what lands in your business account. The number your accountant spent all year making as small as legally possible.

We have written before about what it feels like when a lender says no to a self-employed applicant, and the pattern behind a lot of those declines is not bad credit or bad luck. It is good accounting pointed in the wrong direction.

The number lenders actually use

Lenders do not have one rule for the self-employed, they have one rule per business structure, and the differences matter more than most applicants expect.

Two identical businesses, each generating the same real income, can support very different mortgages depending on which row they sit in and which lender reads the file. This is why the choice of lender is not a detail. It is most of the decision.

A worked example

Take a limited company with £160,000 of turnover. After costs the company makes £85,000. The director takes a £12,570 salary and £38,000 in dividends, and leaves the rest in the business, which is exactly what most accountants would suggest.

A mainstream lender assessing salary plus dividends sees income of £50,570. At a typical multiple of 4.5 times income, that supports borrowing of about £227,000.

A specialist lender assessing salary plus share of net profit sees something closer to £97,000 of income, supporting borrowing of around £437,000.

Same company. Same year. Same director. The difference between the two assessments is over £200,000 of borrowing, and the applicant did nothing differently except walk through a different door. The figures are illustrative, but the shape of them is real, and it is the single most useful thing a self-employed borrower can understand before applying anywhere.

The two-year average, and the year that drags you down

Most lenders want two years of figures and will average them. A few will work from the latest year alone, and a few will accept a single year of trading. That sounds like flexibility until you notice the catch: if your latest year is lower than the year before, almost every lender abandons the average and uses the lower figure on its own.

So a business that did £70,000 then £50,000 is assessed on £50,000, while a business that did £50,000 then £70,000 might be assessed on £60,000. Growth is averaged, decline is punished. If you had one soft year because you took time off, invested in kit, or lost a client and replaced them, the file needs to explain that, because the numbers alone will not.

Planning eighteen months out

None of this means tax efficiency is a mistake. It means a mortgage application is a project with a lead time, and the planning window is roughly the two accounting years before you apply.

If you know a purchase is coming, that is the time to talk to your accountant about the balance between tax saved and borrowing lost. Declaring more profit means paying more tax, and sometimes that trade is worth it and sometimes it is not. A director who pays an extra few thousand in tax to unlock an extra £100,000 of borrowing on a home they intend to stay in may consider that cheap. A director who does it to stretch onto a bigger buy-to-let may not. The point is to do the arithmetic on purpose rather than discover it in an underwriter’s email.

And if the accounts are already filed and the purchase cannot wait, the answer is usually not a bigger deposit or a smaller house. It is finding the lender whose method fits your structure, which is exactly the territory we covered in the broker who read my accounts. An adviser who reads company accounts properly will often find income a high-street application form has no box for.

What not to do

One warning, because it comes up every time this subject does. The fix for a low declared income is never to declare income you did not earn, and it is never to “adjust” documents. Lenders cross-check SA302s and tax year overviews directly against HMRC records, and a mismatch is not a decline, it is a fraud marker with a six-year memory. Slower and honest beats fast and flagged, every time.

Frequently asked questions

Can I get a mortgage with only one year of accounts? Yes, with a smaller pool of lenders, and the file needs to be clean elsewhere. Two years opens most of the market, three years opens effectively all of it.

Do lenders count retained profit in my company? Some do, most do not. The lenders that assess salary plus net profit share are mostly specialist or intermediary-only, which in practice means you reach them through a broker rather than a branch.

My dividends vary a lot year to year. Is that a problem? Variation is normal and lenders expect it. What unsettles underwriters is a latest year sharply below the previous one with no explanation, so provide the explanation before they ask.

Does turnover matter at all? Barely, on its own. A lender might glance at it for context, but affordability is built on taxable income or drawn income. A £300,000 turnover with £20,000 of declared profit is, to a lender, a £20,000 income.

The self-employed do not get worse mortgages because lenders dislike them. They get worse mortgages when the paperwork built for one audience is handed, unedited, to a completely different one. Know which number your structure produces, know which lenders read it generously, and give yourself the two-year run-up to shape it. The tax return and the mortgage application are the same document. Write it once, for both readers.

The Budget Will Show Up In Your Accounts For Two Years

What 28 October means for your self employed mortgage

This is a composite of conversations we have most weeks, written up as one piece. Market figures are accurate as at 18 August 2026.

He asked the question at the end, almost as an afterthought, the way people do when they think it is a silly one. If I take a bigger dividend this year to get ahead of the Budget, does that help me or hurt me? What he was really asking was a self employed mortgage question, and it is the one most people get backwards.

It was the best question anybody had asked me all month. The answer depends entirely on when you want a self employed mortgage, and almost nobody joins those two things up.

Here is the problem in one sentence. A lender assessing a self employed mortgage application looks backwards at two or three years of accounts. A tax decision you make in the next ten weeks does not sit in this year and then disappear. Instead, it sits in the file a lender reads in 2027 and 2028.

The Autumn Budget is being discussed everywhere as a tax event. For anybody who works for themselves and wants to borrow, however, it is also an affordability event with a two year tail.

What is actually on the table, and what is guesswork

The Budget is on 28 October 2026. That much is fixed. Beyond the date, the picture mixes the reported and the speculated, and it is worth being clear about which is which, because a lot of the coverage is not.

Reported and reasonably well sourced

Economists at Capital Economics have warned that the government could raise taxes by up to £25 billion to fund its spending commitments, which would push the overall tax burden to around 39 per cent of GDP. Furthermore, HM Treasury has explicitly declined to rule out further capital gains tax reform. Pension reliefs and some form of new wealth or sector specific levy are both under active discussion in the press.

Speculation dressed as reporting

Specific numbers, particularly the widely repeated suggestion that capital gains tax could rise from 18 and 24 per cent toward 30 per cent or beyond, are being printed well ahead of any Treasury confirmation. They may turn out to be right. Currently, though, they are guesses, and the confident tone in which they are written is doing a lot of unearned work.

Why it is getting attention at all

The reason is the fiscal backdrop rather than politics for its own sake. Andy Burnham took over on 20 July, appointed John Healey as Chancellor, and the gilt market immediately tested him. Ten year yields jumped eight basis points to 5.04 per cent on Burnham’s early remarks about flexibility within the fiscal rules, while thirty year yields touched levels last seen in 1998. They came back once Healey was confirmed. Nevertheless, the message from the bond market was unambiguous: there is not much room, and it will be priced in advance.

That is the constraint the Chancellor works inside. Consequently, “he might just do nothing” is not a realistic base case.

Why tax planning and your self employed mortgage collide

If you are a sole trader or you run a limited company, the levers people reach for before a Budget are the same levers a mortgage underwriter uses to assess you. Unfortunately, they pull in opposite directions.

If you crystallise gains early

Selling an asset before a rumoured CGT increase is legitimate to consider. However, a large one off gain lands in a tax year and, depending on how you are structured, can distort the picture a lender builds of your normal income. Underwriters are trained to strip out non-recurring income. As a result, you can end up with the worst of both outcomes: the gain gets taxed, and it does not count toward affordability.

If you change how you pay yourself

Bringing dividends forward, or shifting the salary and dividend split, changes the two numbers most lenders actually key in. For a director that is usually salary plus dividends, or in some cases salary plus retained profit. A one year spike followed by a dip reads badly. In fact, lenders very often take the lower of the two most recent years, or an average, precisely to stop applicants gaming a single year. Anybody telling you a bumper year automatically improves your borrowing is describing a lender that does not exist.

If you increase pension contributions

Pension tax relief has been a talked-about Budget target for years and is in the frame again. Loading contributions before a possible change can be sensible. Be aware, though, that large employer pension contributions reduce retained profit, and retained profit is what several of the more flexible lenders use for directors. In other words, you can improve your tax position and reduce your self employed mortgage capacity with a single instruction to your accountant.

None of these are reasons not to plan. Rather, they are reasons to have the mortgage conversation and the accountant conversation in the same month, not eleven months apart. The people who get hurt are almost never the ones who did something reckless. They are the ones who did something perfectly sensible in isolation.

Self employed mortgage affordability is tighter than growth suggests

There is a version of the current story that sounds fine. The UK was the fastest growing G7 economy in the first half of 2026. GDP grew 0.4 per cent in the second quarter. Monthly GDP rose 0.3 per cent in June against expectations of nothing at all. Moreover, EY nudged its 2026 growth forecast up to 0.9 per cent.

Underneath that, however, the numbers relevant to a self employed mortgage are less comfortable.

Why a cooling labour market hits the self employed first

Growth holding up while employment falls is not a comfortable combination. For the self employed specifically, a cooling labour market usually shows up first as clients paying later and projects being deferred, rather than as a headline. Lenders know this. Consequently, self employed mortgage applications get looked at harder in periods like this one, not more sympathetically.

If you have had a default or a rough patch in the last few years, that is the context you are applying into. It is not hopeless, and the age of the marker still matters more than most people expect. Even so, the file needs to be tidy and the story needs to be coherent, because there is less benefit of the doubt going around than there was eighteen months ago.

Four things worth doing before late October

Work out which year a lender will read

If you are applying in early 2027, ask your accountant which two years will be on the table. Then you know whether a decision taken this autumn lands inside or outside the assessment window. This one question resolves most of the confusion.

Do not restructure on the basis of a newspaper figure

The CGT numbers being quoted are not confirmed. Therefore, restructuring a company or triggering a disposal to pre-empt a rate that may not arrive is an expensive way to be right about the direction and wrong about the size.

Check the wrapper before you check the rate

If part of your planning involves moving money out of a taxable position, the ISA allowance is the obvious first stop and the one that gets skipped, usually because people assume it is only for large sums. Gains and dividends inside an ISA sit outside CGT and dividend tax entirely, which is precisely the exposure being discussed for the Budget. If you have never used one, a straightforward comparison of stocks and shares ISA providers will show you the fee structures side by side, which is where the meaningful differences are for anybody contributing monthly rather than in lump sums.

Get the credit file seen before the accounts are finalised

Not after. If there is a default, a missed payment or a CCJ on there, the sequencing of your accounts and your self employed mortgage application matters, and it is much easier to plan around a problem you already know about.

The thing I would actually say to him

The instinct to act before a Budget is a good instinct. It is just usually aimed at the wrong target.

Most self employed people I speak to are trying to optimise a tax bill they can see. In doing so, they quietly damage a mortgage application they will not submit for another year. The tax bill is a number on a page. The mortgage is the house. When the two conflict, and this autumn they might, it is worth being deliberate about which one you are optimising for.

There is also a decent argument for doing very little. Between the Ofgem announcement on 26 August, the Bank of England decision on 17 September and the Budget on 28 October, there are three points in the next ten weeks where the picture changes with actual information rather than speculation. Acting now, therefore, means acting on the least information you will have at any point in that window.

What people ask before they ring

Will the Budget definitely raise capital gains tax?

No. The Treasury has declined to rule out reform, which is not the same as confirming it. The specific rates being quoted in the press are speculation.

Should I take a big dividend before October?

Ask your accountant about the tax, and ask a broker about the self employed mortgage, before you do either. A spike in one year followed by a drop often reads worse to a lender than two steady years, since many lenders take the lower year or an average.

I have two years of accounts. Is that enough?

For a lot of lenders, yes. Some will work with one year in the right circumstances. Generally it depends more on the profession, the consistency and the file than on the number by itself.

Does a default stop me getting a self employed mortgage?

It narrows the options rather than closing them. How long ago it was registered typically matters more than the amount. However, self employment and a default together mean you need a lender panel that covers both, which is a narrower set than either on its own.

Is now a bad time to be buying?

The housing side is arguably in a buyer’s favour. For example, Rightmove recorded the biggest August fall in asking prices for eight years, and there is a twelve year high in homes for sale. The borrowing side is the harder half, with the average two year fix around 5.6 per cent.

Should I wait until after 28 October to apply?

If your application is straightforward, waiting mostly means waiting. If it involves restructuring, a disposal, or a change in how you pay yourself, then yes, knowing what is actually in the Budget before you act is worth ten weeks.

Nothing here is tax, mortgage or investment advice, and none of it substitutes for an accountant who has seen your accounts. Figures quoted are as at 18 August 2026. Tax treatment depends on individual circumstances and can change, including at the Budget this article is about.

She said my defaults were the easy half

This is a composite of conversations we have most weeks, written up as one story. Details have been changed. It is a personal account, not mortgage or tax advice.

The short version. I’m a self employed builder with two satisfied defaults from 2023 and nineteen years of trading behind me. A national broker declined me over the phone in four minutes without ever seeing my accounts. A local broker in Benfleet asked for two years of accounts, both SA302s, the exact dates of the defaults, a written explanation of what happened in 2023, and my accountant’s phone number. Then she told me the defaults were the easy half of the problem and that my accounts were the bit we needed to talk about, which was not the order I’d have put them in. She would not promise me a mortgage. She told me exactly what a yes would need.

The folder sat on the passenger seat of the van from Tuesday to Friday.

Two years of accounts, both SA302s, my credit report printed out because I don’t trust reading anything important on a phone.

I don’t really know what I was waiting for.

I think I’d decided that if a local broker told me no as well, that was that. And I’d rather not know than know.

Anyway. Friday, ten past twelve, sat in a lay-by eating a sandwich.

I rang her.

She asked me what happened

Not what my salary was.

I want to make more of that than it probably deserves, but it was the first question anybody had asked me in a month that I could actually answer.

So I told her. The commercial job, the client going under, the fourteen grand, the three lads, the merchant account, the credit card and the loan I let go instead.

She didn’t interrupt and she didn’t make a noise when I said the word defaults.

Then she asked how old they were, whether they’d been satisfied, and what the balances had been.

Then she asked how long I’d been trading.

Nineteen years, I said.

And she said: right, so you’ve got a nineteen year old business and two administrative marks from one bad client. Those are not the same size of problem, and I don’t think you’ve been treating them like it.

“Your defaults are the easy half of this”

Here’s what she actually said, and I’ve thought about it a lot since:

“Your defaults are the easy half of this. Two of them, three years old, both satisfied, with a proper reason behind them. I can work with that. The bit we need to talk about is your accounts.”

Which was not the order I’d have put those in a fortnight ago.

I’d spent three years thinking of myself as a man with bad credit.

She spent about nine minutes on my credit file and the rest of the hour on my income.

Can you get a mortgage with defaults? What she actually said

She was careful here, and I appreciated it, because everything else I’d read that month had been either “guaranteed approval” or “give up”.

What she said was that with defaults, the questions a lender asks are: how old are they, how many are there, have they been satisfied, how big were they, and what was the reason. And that mine answered well on nearly all of those.

She said there are lenders who care much more about the last two years of conduct than they do about 2023.

She also said some of them would likely want a bigger deposit from me than from somebody with a clean file, and that she’d put the numbers in front of me before I decided anything.

Then she said the thing about my accounts again, because I clearly hadn’t taken it in the first time.

What she asked for that the call centre didn’t

In order:

Two years of accounts, and both SA302s. She said some lenders will work from one year but two gives more options, and that she wanted to see the shape of the business rather than one number off a form.

The exact default dates from my credit file. Not roughly. The actual registration dates, because how old they are matters more than the fact they exist, and because it changes when certain lenders come into play.

A written explanation of 2023. Not a sob story, her words. Dates, the client, the amount outstanding, what I chose to do and why. She said an underwriter reading that next to two satisfied defaults sees something completely different to an underwriter who just sees two defaults and no context.

My accountant’s phone number.

That last one stopped me.

She wanted the three of us on a call, so that the accounts, the tax position and the mortgage could be discussed in the same conversation rather than three separate ones that never meet.

Nineteen years self employed. Nobody has ever suggested that to me. Not once.

The bit about my accounts that I didn’t want to hear

I’d worked out on my Sunday that my declared profit was the real obstacle, and I was half hoping she’d tell me I’d got that wrong.

She didn’t. She said I’d got it right.

She was clear that nothing about how my accountant has handled it is improper. It’s correct, it’s legal, and it has saved me money. It just optimises for a tax bill rather than for a mortgage application, and nobody had ever asked me which of those two I wanted this year.

She also said, and this is the bit I’d have paid for on its own, that the answer is not to go away and quietly pay myself less in order to save a bigger deposit. That was my plan. It would have done nothing to the figure a lender looks at and made this year harder for no reason.

So the plan is a conversation with my accountant, with her on the call, about how this year gets structured and what it means for both the tax and the borrowing. Properly, in advance, with both sets of consequences on the table.

What she wouldn’t do

She wouldn’t tell me I’d get a mortgage.

I asked. Twice, in slightly different words, because after a month of this I badly wanted one person to just say it out loud.

She said she wasn’t going to promise me an outcome on a first phone call, but she’d tell me exactly what a yes needs and then I could decide whether I wanted to do it.

She also said that if she couldn’t help me this year, she’d tell me what to change so she could help me next year.

Which is a strange thing to say when you’re trying to win somebody’s business, and it’s the reason I believed the rest of it.

Where I am now

Officially, nowhere.

I have not been approved. Nothing has been agreed. There’s a real chance the numbers don’t work this year and we rent on Canvey for another twelve months.

But I know what the actual problem is, which I didn’t three weeks ago. I know it isn’t really the defaults. I know the thing holding me up is a structural decision about my own business rather than a black mark I have to sit out until 2029.

And I know there’s a plan, with a timescale, and a person doing it who has read my accounts.

Four minutes with the first lot.

An hour and ten with her, and she was twenty minutes up the road the whole time.

Part one: Four minutes and eleven seconds to decide about a house Part two: How long does a default stay on your credit file?

What people ask before they ring

Can you get a mortgage with defaults on your credit file? Often, yes. The questions that decide it are how old the defaults are, how many there are, whether they have been satisfied, how large the balances were, and whether the reason behind them can be explained. Two satisfied defaults from three years ago sit at the more workable end of adverse credit.

Do I need to wait until my defaults drop off? No. Defaults stay on a credit file for six years from registration, but plenty of lenders will consider an application well before then. Waiting can be the right decision, but it should be based on what is actually on your file rather than an assumption.

Can a sole trader get a mortgage with bad credit? Yes, though it needs both halves handled together. Lenders assess a sole trader on net profit evidenced by accounts and SA302s, so the income side often needs as much attention as the credit side. A process that only asks for a salary will usually fail before it reaches your credit file at all.

How many years of accounts do lenders want? Most want two years. Some will consider one year of accounts, which can matter if a recent year is stronger than an older one.

Will a broker’s first conversation put a search on my credit file? An initial discussion about your circumstances does not. A formal application does, which is why establishing the right lender first matters when your file already has adverse credit on it.

What should I bring to a first call? Your credit report, two years of accounts and SA302s if you are self employed, and a short written note of what happened and when. Turning up with those saves a fortnight.

If a form turned you down without anybody reading your accounts, that was not a verdict. Angela Little is a specialist bad credit mortgage broker in Benfleet, Essex, experienced in mortgages with defaults and self employed and director income. Free quote, no obligation, no pressure to proceed. Start your journey, or ring 01268 387898 and tell her what happened.

I’d been carrying the word default around for three years without knowing what it meant

This is a composite of conversations we have most weeks, written up as one story. Details have been changed. It is a personal account, not mortgage or tax advice.

The short version, so you don’t have to give up your Sunday like I did. A default is what a lender registers when it decides an account has gone bad, usually after three to six months of missed payments, and it stays on your credit file for six years from the date it was registered. Not from the date you clear it. Paying it off marks it as satisfied, which lenders would much rather see than an unpaid one, but it does not remove the record or restart the clock. A default is more serious than a missed payment and less serious than a CCJ, an IVA or bankruptcy. And if you’re self employed, lenders assess you on the profit shown in your accounts and tax calculations, not your turnover and not what you draw out.

That last sentence is the one that ruined my afternoon.

My wife asked me what a default actually is.

Nineteen years self employed, two of them on my file, and I couldn’t tell her.

I knew what it felt like. I didn’t know what it was.

So I gave up the Sunday to it, and I found out more in six hours than I had in three years of assuming.

How long does a default stay on your credit file?

Six years.

That’s the number, and most people know it.

Here’s the bit I didn’t: the six years runs from the date the default was registered, not from the date you pay it off.

Mine went on in 2023. They come off in 2029, and there is nothing I can do about that.

Paying it off does not restart anything

I’d been quietly proud of clearing those two accounts in 2024. Felt like I’d fixed it.

I hadn’t fixed it. I’d settled it, which is a different thing.

What paying it off does is change the status to satisfied. That matters. A satisfied default tells a lender the debt got dealt with, and an unsatisfied one tells them it’s still hanging there unresolved. Some lenders will only look at defaults that have been satisfied at all.

So it was worth doing. It just wasn’t the reset button I thought I’d pressed.

What a default actually is

Turns out it’s not a punishment somebody chose to give me. It’s an administrative event.

When you stop paying a credit agreement, the lender chases you, and after a period of arrears, normally somewhere between three and six months, they decide the relationship has broken down and they close the account as defaulted. That decision gets reported to the credit reference agencies.

Which means the exact date on my file was decided by an admin process at a credit card company in 2023, while I was on a roof somewhere trying to earn the money back.

I’d never seen the actual dates until that Sunday. I’d never looked at my own credit file. Nineteen years of running a business and I’d never once read the document that other people were using to judge me.

Where a default sits on the scale

This bit cheered me up, briefly.

There’s a hierarchy, and each step down is a bigger deal to a lender than the one above:

Two satisfied defaults from 2023 is not the bottom of that list. It’s the middle, ageing, and already dealt with.

I sat there thinking: so why did four minutes on the phone make it sound like the end of the world?

Then I found the bit about self employed income

And this is where the Sunday stopped being encouraging.

I’d assumed my defaults were my problem.

They’re not the main one.

Lenders don’t assess a self employed person on turnover, and they don’t assess you on what you take out of the business. For a sole trader like me it’s net profit, the figure left after costs, evidenced by your accounts and your SA302s. An SA302 is the tax calculation HMRC produces from your self assessment return, and it’s the number most lenders work from.

Most want two years of it. Some will look at one year, which I didn’t know either.

So I got the folder out and I looked at my own SA302s properly for the first time in my life.

And they’re low.

Not wrong. Not dodgy. Low.

My accountant has been doing exactly what I asked him to

Because for years, my accountant, who is good at his job and has saved me a lot of money, has quite legally kept my declared profit as far down as it will go. Every allowable expense, every bit of kit through the books, all of it correct and all of it above board.

Which is brilliant for a tax bill.

And it turns out the number he’s been carefully minimising is the exact same number a lender uses to decide what I can borrow.

Nobody had ever mentioned that those two things pull against each other.

Not my accountant, who was doing precisely what I hired him to do. Not the bank. Certainly not the bloke on the phone with the form.

I’ve spent six years being efficient in a way that made me look poor to the only people I now need to look solvent to.

And my clever plan was going to make it worse

Because my answer to being declined had been: right, save harder, get a bigger deposit, go back in six months.

And the way I was going to save harder was by taking less out of the business.

Which does nothing to the figure they actually look at, and pinches us for no reason in the meantime.

I’d have done a whole year of that and turned up in front of the same form with the same problem.

So where does that leave me

Better informed and more annoyed.

I know my defaults come off in 2029 and I know they’re satisfied and mid-table rather than fatal.

I know the actual obstacle is my own accounts, prepared properly by a professional, doing exactly the job I paid him to do.

What I don’t know is whether that’s fixable. Whether there’s a way to buy a house in Hadleigh next year, or whether I’ve spent nineteen years building a business that’s very good at feeding us and structurally incapable of getting us a mortgage.

I’m not ringing another call centre to find out. I’ve done my four minutes.

Lad on a job in Benfleet last week mentioned a local broker his sister used. Small firm, up the road, deals with this sort of thing.

The folder’s on the passenger seat of the van. Two years of accounts, both SA302s, and my credit report printed out.

It’s been there since Tuesday.

Part one: Four minutes and eleven seconds to decide about a house Part three: She said my defaults were the easy half

Four minutes and eleven seconds to decide about a house

This is a composite of conversations we have most weeks, written up as one story. Details have been changed. It is a personal account, not mortgage or tax advice.

The short version, because you’re probably reading this in a van. I’m a self employed builder on Canvey Island. In 2023 a commercial customer went under owing me £14,000, and I paid my three lads and my merchant account before I paid a credit card and a personal loan I’d taken out to buy materials for that same job. Six months of nothing on those two accounts got me two defaults. Last month a national broker declined me over the phone in four minutes without ever asking to see a set of accounts, because their form wanted a salary and a sole trader hasn’t got one. I’ve got a deposit, a full order book into next spring, and I earn more now than I did before any of it happened.

I was in the van outside a job in Rayleigh when they told me no.

Hands-free, half nine in the morning, lad in the passenger seat pretending not to listen.

Four minutes. I looked at the call log afterwards because I couldn’t believe it.

Four minutes and eleven seconds to decide about a house.

The bloke on the phone sounded about twenty-two. Perfectly polite. Reading off a screen.

He asked me what my salary was.

I said I haven’t got a salary. I’ve got a business.

And that was it, really. Everything after that was him trying to find a box to put me in and not finding one.

The job that cost me £14,000

Here’s what happened, and I’d like somebody to tell me which bit I got wrong.

2023. Decent sized job, commercial, client I’d worked for twice before. Got about two thirds of the way through and they went under. Fourteen grand owed to me and no chance of seeing it.

I had three lads on that job and a merchant account that needed settling.

So I paid them.

All of them, in full, that month, because they’ve got kids and rent and they turned up and did the work.

What I didn’t pay was a credit card and a personal loan I’d taken out to buy materials for that same job.

Two accounts. Six months of nothing.

Two defaults.

Why I’d make the same call again

I cleared both of them in 2024 when the work came back. Paid every penny of it.

If you put me back in that month I’d do exactly the same thing in exactly the same order.

You don’t tell a man with two kids that his wages are late because a client you chose to work for turned out to be a bad one. That’s my problem, not his.

So I took it on the chin, and the chin turned out to be my credit file.

We’re not trying to buy anything clever

We’re renting on Canvey. Two kids, both settled at school. We want to buy in Hadleigh so nothing has to change for them.

That’s it. That’s the whole ambition. Same postcode, one bedroom more, and a garden that isn’t shared.

I’ve got the deposit. I’ve got work booked into next spring. Nineteen years self employed and I’ve never had a week off with nothing to do.

The advert said whole of market

Access to every lender. Specialists in complex cases.

Four minutes.

Never asked to see a set of accounts. Never asked what the business turns over, or what it clears, or what happened in 2023. Never asked for a single document.

Asked me for a salary twice, in slightly different words, like I’d misunderstood the question the first time.

They didn’t turn me down, a form turned me down

That’s the part that actually wound me up, and it took me a couple of days to work out why.

It wasn’t that they said no.

It’s that they said no without looking.

I’ve got two years of accounts and tax calculations sat in a folder in the office. There’s a full explanation of 2023 in there for anybody who wants it. Invoices, the lot.

Nobody wanted it. The form wanted a number in a box marked salary, and because I couldn’t give them one, the conversation was over before my accounts were ever relevant.

I said to my wife that night: they didn’t turn me down, a form turned me down.

And she asked me a reasonable question.

She said, right, so what actually is a default?

And I couldn’t answer her

Nineteen years self employed. Three defaults’ worth of grown-up decisions behind me, two of them my own.

And I’ve been carrying that word around for three years without ever once finding out what it properly means, how long it lasts, or whether paying it off did anything at all.

I didn’t know.

I knew what it felt like. I didn’t know what it was.

So I gave up the Sunday to it.