Getting a Mortgage When You Work for Yourself in East Sussex
Being self-employed should never stop you buying a home or remortgaging, but it does mean the way a lender reads your income matters enormously. Two applicants with identical earnings can be offered very different loan amounts simply because one lender looks at dividends while another looks at the profit the business actually made. At TMS we help sole traders, partners, Limited Company directors and CIS contractors across Hastings, Eastbourne, Bexhill, Tunbridge Wells and the wider county present their income in the way that gives them the strongest, most accurate borrowing figure.
This 2026 guide explains how lenders assess each type of self-employed income, how many years of accounts you really need (often just one), and what you can do now to improve your position before you apply.
Limited Company Directors: Salary + Share of Net Profit
Most company directors pay themselves a small salary and take the rest as dividends for tax efficiency. Many lenders simply add salary and dividends together, which can badly understate what you earn if you leave profit in the business to grow it or to manage your personal tax bill.
A growing number of lenders will instead assess salary plus your share of the company's net profit. Depending on the lender this can be profit before corporation tax or after corporation tax. For a director who owns 100% of a company paying a £12,570 salary and generating £70,000 net profit, the difference between a dividend-based assessment and a profit-based one can be tens of thousands of pounds in borrowing.
- Salary + dividends: the most common approach, usually from your SA302s and Tax Year Overviews.
- Salary + share of net profit after tax: recognises retained profit, typically using your company accounts.
- Salary + share of net profit before tax: offered by a smaller number of lenders and can give the highest figure.
- Shareholding matters: if you own 50% of the company, lenders normally use 50% of the profit.
Your accountant's certificate or full filed accounts will usually be needed, and lenders will want to see that retained profit is genuinely available rather than already committed. We check this before your application goes in so there are no surprises at underwriting.
Sole Traders and Partners
If you are a sole trader or in a partnership, lenders assess your net profit (your share of it in a partnership) rather than turnover. The standard evidence is your SA302 tax calculations and matching HMRC Tax Year Overviews, ideally for the last two years, although some lenders accept accountant-prepared accounts instead.
Can I get a mortgage with 1 year's accounts?
Yes. Several mainstream lenders will lend with just one full year of trading accounts, particularly if you have moved from employment into the same line of work. This is common for tradespeople, consultants, hairdressers, nurses moving into agency work and IT contractors setting up on their own.
Latest year versus average
Where you have two or more years, lenders differ in how they treat them. Some take an average of the last two years; others will use the latest year provided income has increased. If your profits jumped last year, a lender using your latest figure could offer significantly more. If profits fell, a lender that averages may be kinder. Choosing the right lender for your pattern of income is exactly where an independent broker adds value.
CIS Subcontractors and Day-Rate Contractors
Construction Industry Scheme (CIS) workers are often treated as self-employed for tax but many lenders can assess them more like employees. Rather than waiting for a tax return, some lenders will use your gross CIS payslips, annualising your typical weekly or monthly income. A common method is your average gross weekly pay multiplied by 46 to 48 weeks, allowing for holidays and downtime.
Day-rate contractors, including IT, engineering and professional contractors, can often be assessed on their contract day rate, typically day rate × 5 days × 46–48 weeks, with as little as a few months on the current contract if there is a track record in the same field.
- Keep at least three months of CIS statements or payslips ready.
- Bank statements should show the payments arriving.
- Gaps between contracts should be explainable.
- A copy of your current contract helps day-rate cases.
Buying, Remortgaging or Moving Up
The same principles apply whether you are a first-time buyer, moving home with a residential mortgage, or remortgaging when your fixed rate ends. When remortgaging, a director who was previously assessed only on dividends may find a profit-based lender can offer a better rate or allow capital raising for home improvements.
How to Strengthen Your Application
- Ask your accountant to file accounts and tax returns promptly so the latest figures are available.
- Download your SA302s and Tax Year Overviews from your HMRC online account.
- Keep business and personal banking separate and well managed.
- Avoid new credit or missed payments in the months before applying.
- Talk to a broker before you make an offer so you know your realistic budget.
Local Advice Across East Sussex
TMS is based locally and supports self-employed clients throughout the area, including our mortgage broker service in Hastings, mortgage advice in Eastbourne, Bexhill mortgage broker and Tunbridge Wells mortgage advisor services. We search the whole market, speak to underwriters in advance on complex cases and handle the paperwork from start to finish.
Your home may be repossessed if you do not keep up repayments on your mortgage.
Speak to TMS
Self-employed, a company director or a CIS contractor? Contact TMS today for a free, no-obligation chat with an adviser.
Frequently Asked Questions
How many years of accounts do I need for a self-employed mortgage?
Many lenders prefer two years, but several will accept one full year of trading accounts or one SA302, especially if you continued in the same line of work.
Can a company director use retained profit for a mortgage?
Yes. Some lenders assess salary plus your share of net profit, before or after corporation tax, rather than just salary and dividends, which can increase how much you can borrow.
How do lenders calculate CIS income?
Many lenders annualise your gross CIS payslips, typically multiplying average weekly income by 46 to 48 weeks, rather than relying on your tax return.
Will lenders use my latest year's income or an average?
It depends on the lender. Some average two years, while others use the latest year if income has risen. We match you to the method that suits your figures.
Do I need a deposit of more than 10% if I'm self-employed?
Not necessarily. Self-employed borrowers can access 5% and 10% deposit mortgages, subject to affordability and credit history.
