Want to go self-employed?  This is what you need to know…

Why would you want to work for someone else?  It’s not a very inviting prospect when it’s Sunday evening and you know that the following morning involves having to work your guts out all for the benefit of someone else who you don’t even like very much - that’s not my idea of fun!

Instead, you want to be your own boss - you want to make your own decisions and be responsible to yourself and no one else.  Well, obviously you can do just this - you can start your own business and start your new life as a self-employed worker - this is how you can do it;

Register

As with any new venture, you have to first register your move with the government.  You need to register with Her Majesty’s Revenue and Customs (HMRC) as now you plan on going alone you, and only you, are entirely responsible for your own taxes and National Insurance contributions.

You are given a three-month grace-period by the HMRC in which time you are required to register - if you don’t you’ll find that you’ll be in a spot of trouble so get it done!

VAT

If you are expecting your business to turn over anything above £68,000 over a 12-month period then you must register for VAT.  Once you eventually do pass the £68k mark then it is your responsibility to get in touch with the HMRC within 30 days otherwise you’ll once again find yourself in a tight spot and slapped with a fine.

The positive side of VAT collecting means that you can provide your business with substantially more credibility and you can also claim on VAT with regards to relevant purchases made.

The negative side of VAT is the amount of detailed records you must make so it’s not all good news!

Bank Account

It is vital that you draw a strong line between your private life and your business life - without doing so by getting a bank account specifically for your business you will not be able to know, and neither will your customers, where you end and your business begins.

Create a business bank account - it is professional and you will benefit from specific business rates and charges that will not necessarily be afforded to personal bank accounts.

If anything, it’s always a professional move to have your business’s name printed on your cheques.

Insurance

Every business should look at getting secure with insurance.  Business insurance reduces your risks massively and you can sleep at night knowing that you won’t be in serious trouble if someone decides to take you to court for example.

You might feel secure working as a self-employed person but you should still check out professional indemnity and public liability insurance to make sure you are safe!

Going it alone?

Are you looking to start up on you own?  Do you think the recession is the right climate to go self-employed?  Let us know…

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