While they are often referred to as the same thing, there are differences. A sole trader is a specific type of self-employment. As the title suggests, it means an individual owns and runs their business on their own. They take full responsibility for its finances and day to day activities. They may have registered their business with the government under their own name. A self-employed individual might not operate as a sole trader. They may choose to work in a partnership or a limited company. But in any case, they aren't employed by anyone and are responsible for their own taxes.