Working for yourself: where to start
Published Tue, Jan 29, 2013 Updated Tue, Feb 16, 2021
For many employees around the UK the thought of becoming self-employed and working for themselves is a dream yet to be attained. On the surface, becoming self-employed offers individuals benefits such as working at your own pace, having complete control of your own business and answering to no one but yourself. Such benefits make the decision even more desirable, therefore if you have a business idea, self-drive and determination then you might be already taking the first steps towards establishing your own business.
However, despite the benefits, becoming self-employed also entails plenty of hard work, increased responsibility and a vast amount of potential pit-falls. Therefore, before such a decision is made it is imperative one gives consideration and thought to the process behind the transition from employee to business owner.
Familiarise yourself with the realities
Popular preconceptions often mask the true reality of the hardships being self-employed demands. Ask any self-employed worker and they will state the long hours and hard work they have entailed to ensure success and a meaningful income. With the great control of becoming a business owner comes an increased level of responsibility that is often overlooked. Finance is one such area and is often one of the most difficult aspects of business management. Budgeting, being organised and keeping track of all finances associated with your business can be a time consuming but necessary activity.
Self-employment and taxes
Keeping accurate and clear records from the start is imperative to ensure HMRC are kept happy. One of the most simplistic ways to do this is to have separate personal and business bank accounts, which will also make it easier for an accountant, when they are calculating corporation tax, VAT and National Insurance contributions.
Create a business plan before you start
Prior to taking the plunge consideration should also be given to a detailed business plan, which will present clear aims and goals along with in-depth market research. Having a business plan will provide a sense of direction and enable targets to be set, start-up costs to be outlined and profit expectations to be predicted. Any professional advice and assistance available should be acquired for this development due to its obvious benefits associated with experience.
To conclude, if you are fully committed and thinking that the route of becoming self-employed is the best route for you then be ready for hard work and consistent effort if you are to succeed.