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Sole trader vs. freelancer: what's the difference actually?
Written by Ilias2 min read
The terms freelancer and sole trader are often used interchangeably, as if they're the same. Yet they don't mean exactly the same. The difference is subtle, but good to know. This article clearly explains how the terms relate to each other.
What is a sole trader business?
A sole trader business is a legal form: the legal form in which you run your business. With a sole trader business, you and your company are the same for tax purposes; you pay income tax on the profit and are personally liable. It's the most chosen legal form for starting entrepreneurs.
What is a freelancer?
ZZP stands for self-employed without staff. That's not a legal form, but a description of how you work: as a self-employed person without people employed. A freelancer usually has a sole trader business, but could in theory also have another legal form.
How do they relate to each other?
In short: freelancer says something about how you work (alone, without staff), sole trader business says something about your legal form. Most freelancers have a sole trader business, which is why the terms often coincide in practice. That's why they're used interchangeably.
Why does it matter?
For your tax and liability your legal form counts, so the sole trader business. Whether you call yourself a freelancer doesn't change that. It's good to know the distinction, so you know that tax rules concern your legal form, not the label freelancer.
This article provides general information based on the rules known for 2026 and does not replace personal tax advice. For your specific situation, we're happy to take a look with you.
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