1 – Splitting the personal from the business

With unpredictable income it’s more important than ever to keep an eye on what you’re spending. Calculate what monthly income gives you your preferred lifestyle. Use that as a target for earnings. To do this, find some way of recording all your spending, e.g.: Itemise everything you buy for one month in detail – you’ll

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Posted on 31 January 2020

2 – Defining types of business

There is a slightly different version of this help sheet for people living in Wales, Scotland or Northern Ireland. NB: ‘Freelance’ means someone whose income is ad hoc or regularly comes from a variety of clients or employers. It can refer to both employment (e.g. fixed-term contracts) and self-employment. See help sheet 2f for more

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Posted on 30 January 2020

3 – Tax and National Insurance

Do you live in Scotland? There’s a different help sheet for you!See Scottish Tax and National Insurance help sheet > National Insurance for employees/PAYE Employees and company directors pay their NI via the company PAYE system. This is Class 1 National Insurance and is a percentage of the salary, normally 12% (2020-21 rate). National Insurance

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Posted on 29 January 2020

4 – Paperwork, record keeping and digital reporting

Things to keep If you’re paid PAYE it’s a good idea to hold on to the following bits of paper: pay slips P60 (each tax year if you’re employed on 5th April) P45 (on leaving employment, though not all freelancers get one) Bank statements Contracts and other agreements Sole traders and people running companies need to

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Posted on 28 January 2020

5 – VAT – a kind of sales tax

Value Added Tax is a tax on the sale of goods and services. It kicks in when the seller is VAT registered, depending on the item being sold. This applies to sole traders too. A VAT-registered business is effectively a tax collector working for HMRC. The standard rate is 20%. (Some items attract a lower rate

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Posted on 27 January 2020

6 – VAT Flat rate scheme

Changes announced in the Chancellor’s 2016 autumn statement make the Flat Rate Scheme much less useful to a business that doesn’t buy physical ‘goods’ on a regular basis. These changes, introduced from 1 April 2017, make the Flat Rate Scheme very unattractive for freelancers and consultants. VAT rules may change substantially after Brexit. How it

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Posted on 26 January 2020

7 – Invoice template with notes

You can download this annotated invoice here. We also have a downloadable template for you in two different formats: Invoice template in MS Word format > Invoice template in Apple Pages format >

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Posted on 24 January 2020

8 – Accountants (England and Wales)

Accountants are not there to take financial responsibility away from you!You are legally responsible for your own tax even if someone else files your returns. Support bodies vary around the UK. We have a slightly different version of this help sheet for people living in Scotland or Northern Ireland. An accountant’s main role is to help you

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Posted on 23 January 2020

9 – Practicalities for new businesses

Support from family and friends is essential, especially if you are setting up. You will be working hard – even when you are not earning anything. Things to think about, and discuss with those around you: working hours – Decide when you will be a) working & earning, b) working & NOT earning, c) not

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Posted on 20 January 2020

10 – Business planning tips

A business plan benefits you more than anyone else. It concentrates the mind wonderfully and gives you some perspective. You may also need one if you want a business bank account or a loan. It shows that you’ve thought things through. OVERVIEW / SUMMARY In a nutshell, what are the business aims and how will they be

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Posted on 13 January 2020

11 – Your public face

People will look to you to help them understand what sort of work you are looking for. This is true of potential clients, but it’s also true of friends and family. Here are some thoughts: Work out what to say when people ask you what you do. Always make it forward-looking and optimistic. When starting

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Posted on 12 January 2020

New business check-list

Setting up on your own can seem daunting. Here’s a checklist of areas the think about.They won’t all be relevant to everyone all of the time, but they’re important to consider. Draft a plan. What skills/products are you really selling? Work out how long you can survive before our first income. Discuss this with your

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Posted on 06 January 2020

1s – Splitting the personal from the business (Scotland)

With unpredictable income it’s more important than ever to keep an eye on what you’re spending. Calculate what monthly income gives you your preferred lifestyle. Use that as a target for earnings. To do this, find some way of recording all your spending, e.g.: Itemise everything you buy for one month in detail – you’ll

READ MORE >

Posted on 24 June 2000

8s – Accountants (Scotland)

Accountants are not there to take financial responsibility away from you!You are legally responsible for your own tax even if someone else files your returns. Support bodies vary around the UK. We have a slightly different version of this help sheet for people living in Northern Ireland or England and Wales. An accountant’s main role is to

READ MORE >

Posted on 24 June 2000