Self-employed mortgages in Devon are not a niche product. Thousands of people across Torbay and South Devon run their own trades, guest houses, cafés and boat businesses, and lenders lend to them every day. The difference is the paperwork: instead of payslips, lenders want to see how your business has performed over time, usually through your tax calculations and accounts.

Every lender sets its own criteria, so treat this as general guidance and speak to an adviser about your own figures.

What do lenders look for when you’re self-employed?

Lenders want evidence that your income is real, steady and likely to continue. In practice that usually means a trading history of at least two years, proof of income from HMRC or an accountant, and bank statements that back up the figures. They also look at the trend, because income that is steady or rising is easier to lend on than income that has fallen.

What are SA302s and tax year overviews?

An SA302 is HMRC’s tax calculation, showing the income you declared on your Self Assessment return and the tax due on it. A tax year overview confirms what HMRC has recorded for that year. Many lenders ask for both, covering the last two or three years, and you can download them from your HMRC online account or ask your accountant for them.

Lenders work from your tax return, so income you reduce for tax is income a lender cannot count.

How many years of accounts do you need for a self-employed mortgage?

Two years of accounts or SA302s is the most common requirement. A smaller number of lenders will consider one full year, particularly if you did the same work as an employee before going self-employed. Lenders may use your latest year’s income, an average of the last two years, or the lower of the two, which makes a real difference if your income has jumped or dropped.

Sole trader or limited company: which income counts?

For a sole trader, lenders look at net profit, not turnover. A builder with a full order book but high material costs will be assessed on what is left after those costs, not on the value of the jobs.

For limited company directors it is more involved. Many lenders use your salary plus dividends, which can understate your income if you leave profit in the company for tax reasons. Some lenders will instead look at your salary plus your share of the company’s net profit, including retained profit. Your company accounts and a clear explanation of how you pay yourself help an adviser match you to the right approach.

Can contractors get a mortgage?

Yes. Contractors paid a day rate are often assessed differently from other self-employed people. Some lenders will work out an annual income from your day rate and current contract rather than waiting for two years of accounts, as long as you have a track record of contracting and evidence of ongoing work. If you work in construction and are paid under the Construction Industry Scheme, some lenders may look at your CIS statements alongside your tax returns.

Seasonal income and self-employed mortgages in Devon

Seasonal income is normal here, and lenders assess your annual figures, so a quiet February is not a problem in itself. What can raise questions is a bank statement showing a large overdraft through the winter, or a sharp dip in one year with no explanation.

If a wet summer or a refurbishment closure hit one year’s profit, say so up front, ideally with a note from your accountant. Guest houses in Paignton, cafés in Brixham and Dartmouth, boat operators and tradespeople all share this pattern, and an adviser who knows the area can present your figures in context.

How to prepare for a self-employed mortgage application

Gather these before you speak to a lender:

• SA302s and tax year overviews for the last two to three years
• Your latest accounts, ideally prepared by a qualified accountant
• Recent personal and business bank statements
• Proof of your deposit and where it came from
• Photo ID and proof of address
• A copy of your credit file, checked for errors

It also helps to keep business and personal money in separate accounts. With the Self Assessment deadline on 31 January, filing your 2025 to 2026 return early means your latest SA302 is ready sooner if you plan to move or remortgage next year. Talk to an adviser before your accountant finalises the figures, not after.

Frequently asked questions

Can I get a mortgage after one year of self-employment?

It is possible. Some lenders will consider one year’s accounts, especially if you have a history in the same line of work, but the choice of lenders is narrower than with two years.

Do lenders use my turnover or my profit?

Lenders use your profit, not your turnover. For sole traders that means net profit; for limited company directors it is usually salary and dividends, or with some lenders salary plus a share of net profit.

Do I need an accountant to get a self-employed mortgage?

Not always, as many lenders accept SA302s and tax year overviews on their own. Accounts prepared by a qualified accountant can widen the choice of lenders, particularly for limited company directors.

Contact Riviera Mortgages on 01803 500190 to talk through your self-employed mortgage options in Devon.

YOUR HOME MAY BE REPOSSESSED IF YOU DO NOT KEEP UP REPAYMENTS ON YOUR MORTGAGE.