A step-by-step guide to freelance
Freelance is both a blessing and a curse of a job. On one hand you are your own boss, work whatever hours you want and ultimately the hard work you do is rewarded back to you, but there are of course several obstacles, such as where to find work, competition and ultimately paying yourself enough to get by.
This article is in part about my own journey, some do’s and dont’s and some considerations to make before you decide to do the same.
Do I want to freelance?
Most importantly, before jacking in your job ask yourself are you motivated enough to make this work. Is the risk reward worth it? Can you actually afford to take this risk in the first place? Before taking the plunge it is highly advisable to speak to your partner, family or close friends about your decisions to work for yourself. Think of this as a simple counseling session because freelance isnt for everyone.
Consider your business structure
You need to consider all aspects of the business when you start off from start to finish with each client. Do you have the capacity and knowledge to do this? Do you need help? Does your business require you to outsource? Most local councils are very supportive of new business initiatives and will give out free training and support. Contact them to see how they can help you.
Choose a business name
Choose a name that represents yourself and the business you are in. Having the type of work in the name will help you with online searches, such as “bobs tools”. Now search engines know that you are in the tool trade. Of course, this is only the beginning of how SEO works.
Every business needs a professional identity. Don’t think that your business needs to look unique, that is often the first mistake amateurs will make such as putting terrible fonts together, mismatching colours or not understanding very strict graphic design principles.
Initially it is important to think of how your branding works with your business cards and stationary. If you set up as a LTD company and have a business bank account, the bank will expect to see this..
Accounts & book-keeping
One of the hardest things for me to do to become a freelancer is learn the tax system and book-keeping. I’m not saying they are hard but its an entirely new procedure to document yourself when you pay for things for the company or pay for things yourself. The same goes for recording mileage and perhaps the most complicated element it figuring out how much your bills are worth when you are at home or at work since it is the same building.
I have setup Quickfile and its actually really good for doing all the donkey work for you. Honestly, quickfile instantly presents to your clients a professional face for your business and does the accounting for you.
Taxes, NI and VAT
In terms of making things official, you’ll have to register as self-employed with HM Revenue & Customs (HMRC) if you’re a sole trader and you’ll be expected to pay income tax and National Insurance contributions. If you’re a limited company, you must tell HMRC if it’s liable for Corporation Tax, pay any Corporation Tax due and file a Company Tax Return on time. If in doubt, check out the HMRC website. Or just get your accountant to sort all of this for you.
Working from home?
Working from home may sound incredible to some but please think about the drawbacks. Firstly there is cabin fever to contend with, make sure you get out of the house and take regular breaks. Next there is a social element that I used to enjoy missing. This social part is probably my person vice as I like to hang out with people. Make sure its something you can personally endure. Lastly make sure your work area is setup correctly. If you think working 8 hours a day lurching over a coffee table will work, honestly, think again and make sure you have a designated work area.
I personally love freelancing. I get down on occasion about how to handle certain projects but when I complete a project for a customer its a more rewarding experience than I’ve had working for someone else. Make sure that you stay motivated, positive and make as many connections as possible.