One of the biggest changes in the job markets in recent years has been the rise of the freelancer. Nearly five million people in the UK are now registered as a freelancer in one profession or another and this number looks set to continue. There are a lot of positives to being your own boss but there are also a few points to remember to keep your view of the potential career realistic.
The good stuff
If you are in a job where you dread Sunday night because Monday morning follows it or you are sick of your time being dominated by office politics then you are likely one of the growing group of people who have instead become freelancers. While working practices are changing, many companies still have old fashioned ideas and approaches that care little for the health and mental well being of their staff – so these staff are another group considering a change of direction.
The biggest benefits for many people are the flexibility of working hours, the ability to work at home or where you want and the lack of a tyrannical boss. You do need a certain mind-set to work under these conditions – self-discipline for one and an ability to motivate yourself is another.
Setting yourself up
There are a few steps to take to set yourself up as a freelancer once you know what kind of work you are going to do. First you need to register as self-employed with HMRC. They will advise you about paying tax and your National Insurance with the tax year running from 6h April to 5th April the next year.
From day one, make sure you keep accurate records of all the money you make and your outgoings. It is often well worth getting a professional accountant with expert IR35 knowledge to help with this as not only will they ensure you pay your taxes correctly and don’t get into trouble, they will also see if you are entitled to any tax breaks or other expenses you can claim for. They will also advise if you need to register for VAT (usually if your annual turnover is over £83,000) and if you should be a limited company or just a sole trader.
Part of keeping accurate records involves having a business bank account so this is another important step. Most banks offer special business accounts with debit cards and other basic features with many offering free banking for a period of a year or two. Insurance may also be needed depending on what you do and if you have any business premises.
It can be a bit terrifying when you realise that if you don’t get work, you don’t get paid and that a week off paid is a thing of the past. But if you get yourself organised, have a portfolio or a CV that will attract attention and make use of the various freelance websites that are available to help you find work, it can be surprisingly how quickly it all starts to come together and you join the ranks of the happily self-employed.