Key takeaways
- Professional bookkeeping is an accountancy service under the Money Laundering Regulations, so every self-employed bookkeeper needs an AML supervisor.
- Trading without AML supervision is a criminal offence, and you can face a penalty or prosecution.
- HMRC charges a £300 application fee, £400 a premises each year and £40 for each person tested, with a £500 refund if turnover is under £5,000.
- If you join a professional body that supervises AML, such as the AAT, ICB or IAB, you register with that body instead of HMRC.
- AAT licensed sole traders must hold professional indemnity insurance of at least the higher of 2.5 times gross fee income or £50,000.
- Most small businesses pay the ICO a data protection fee of £52 or £78 a year, with £5 off for paying by Direct Debit.
- The government confirmed on 21 October 2025 that AML supervision of accountants will move to the FCA, but no date has been set.
To set up as a self-employed bookkeeper in the UK you need four things before you take on clients: anti-money laundering (AML) supervision, professional indemnity insurance, a data protection fee paid to the ICO, and Self Assessment registration with HMRC. Bookkeeping itself is not a regulated title, so anyone can call themselves a bookkeeper. The AML rules are the part that carries criminal penalties.
Do bookkeepers need AML supervision?
Yes. HMRC’s accountancy service provider guidance lists “professional bookkeeping services” as an accountancy service under the Money Laundering Regulations 2017. That means you must be supervised for AML by HMRC or by a professional body.
GOV.UK says trading without registering is a criminal offence. You may face a penalty or prosecution if you carry on business without registering first. Accountancy service providers can keep trading while HMRC processes their application.
HMRC or a professional body?
You register with one supervisor, not both. If a professional body supervises you for AML, you do not register with HMRC.
| Route | Who supervises you | When it suits |
|---|---|---|
| Professional body | AAT, ICB, IAB, ACCA or another listed body | You hold or are studying for a bookkeeping or accounting qualification |
| HMRC | HMRC’s AML supervision team | You are not a member of a supervising body |
The bodies most bookkeepers use are the Association of Accounting Technicians (AAT), the Institute of Certified Bookkeepers (ICB) and the Institute of Accountants and Bookkeepers (IAB). Each charges its own practising or licence fee on top of membership. Compare them in our ICB vs AAT guide.
What HMRC AML supervision costs
HMRC’s registration fees page, updated 22 December 2025 for fees from 1 December 2025, sets these charges for accountancy service providers.
| Fee | Amount |
|---|---|
| Application fee (one-off) | £300 |
| Premises fee, each premises, each year | £400 |
| Approval test, each owner, officer or manager | £40 |
If your turnover is under £5,000 you can claim a small business reduction. You pay in full, then email AMLS.Fees@hmrc.gov.uk with “Turnover Reduction” in the subject line, and HMRC refunds £500 once your application is accepted. HMRC’s page is inconsistent on whether the £300 application fee is also waived, so check with HMRC.
What AML compliance involves day to day
Registration is the start. Your supervisor will expect you to have:
- a written firm-wide risk assessment of your clients, services and delivery channels
- policies, controls and procedures that match that risk
- customer due diligence on every client before you act, including identity checks
- ongoing monitoring and records kept for at least five years after the relationship ends
- a process to report suspicions to the National Crime Agency through a suspicious activity report
Our AML risk assessment template and client due diligence checklist cover these in detail.
Is the FCA taking over AML supervision?
Yes, eventually. The government announced on 21 October 2025 that AML supervision of accountancy work will move to the Financial Conduct Authority as a single professional services supervisor. The ATT says the timing is “yet to be determined” and depends on legislation, funding and a transition plan. Until then, keep using your current supervisor.
Do bookkeepers need professional indemnity insurance?
There is no general legal requirement, but every major professional body requires it for members in practice, and clients increasingly ask for it. Professional indemnity insurance pays claims if a client says your mistake cost them money, for example a missed VAT deadline.
The AAT’s rules for licensed members set minimum cover:
| Business type | Minimum limit of indemnity |
|---|---|
| Sole trader | Higher of 2.5 times gross fee income or £50,000 |
| Partnership or company | Higher of 2.5 times gross fee income or £100,000 |
| Gross fees over £400,000 | Cover required capped at £1,000,000 |
Cover must include full civil liability and be fully retroactive. The AAT strongly recommends keeping run-off cover for at least six years after you stop practising. ICB and IAB members should check their own body’s rules. Other cover worth pricing is cyber insurance and public liability if clients visit you. See professional indemnity insurance for accountants.
Other registrations
ICO data protection fee. Sole traders who process personal data must pay the ICO unless exempt. The ICO says most organisations pay £52 or £78 a year, with £5 off by Direct Debit.
Self Assessment. Register as self-employed with HMRC by 5 October after the end of the tax year in which you start.
HMRC agent access. To deal with HMRC for clients, including Making Tax Digital, you need an agent services account. Check the tax adviser registration rules too.
Setup checklist
- Choose your AML supervisor and apply before your first client.
- Write your AML risk assessment and policies.
- Buy professional indemnity insurance that meets your body’s minimum.
- Pay the ICO data protection fee.
- Register for Self Assessment.
- Set up an agent services account and get client authorisations.
- Issue an engagement letter to every client.
Frequently asked questions
Do I need a qualification to be a self-employed bookkeeper?
No. Bookkeeper is not a protected title in the UK, but you still need AML supervision before you take on clients.
Can I start working while my HMRC AML application is processed?
Yes. GOV.UK says accountancy service providers can keep trading while HMRC processes their application, as long as they have applied.
How much does HMRC AML registration cost a bookkeeper?
A £300 application fee, £400 a year for each premises and £40 for each person tested, as of 1 December 2025.
Is professional indemnity insurance compulsory for bookkeepers?
Not by law, but the AAT makes it mandatory for licensed members, with a minimum of £50,000 for sole traders.
Will the FCA become my AML supervisor?
Yes, at some point. The government confirmed the move on 21 October 2025, but no date has been set, so stay with your current supervisor for now.
Sources
Rates, thresholds and rules in this guide were checked against HMRC and GOV.UK guidance on 6 November 2026. Tax rules change, so check the current position on GOV.UK or with a qualified adviser before acting. This guide is general information, not personal advice.
- Money Laundering Regulations: accountancy service provider registration (HMRC)
- Money Laundering Regulations: registration fees (HMRC)
- Who needs to register for money laundering supervision (GOV.UK)
- Professional indemnity insurance for licensed members (AAT)
- Data protection fee: what you need to do (ICO)
- AML supervision moving to the FCA (ATT)