Culture. Freelancing. The boring stuff.

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  1.  
    Has anyone got any good links tucked away for websites that offer advice on the process of setting yourself up as a self employed one man band designer.

    I need advice on how to organise my accounts. Business bank accounts. Tax issues etc.

    Ideally UK specific advice needed.
  2.  
    Whatever you do, get yourself an account with http://www.freeagentcentral.com (I've got a discount code that'd save you 10%, just lemme know if you want it). It'll make handling the accounting side of the business much, much, much easier, and will show you likely self assessment figures etc as well as intelligently handle your uploaded bank account statements etc. I really couldn't recommend it highly enough.

    With regards to setting up in business, it all really depends on how you want to go about it. Setting up as a sole trader is the easiest route, though there's less protection of your personal assets, as you're the business, so if it goes tits up and you owe someone a load of money, you're personally accountable for it. To counter that, I'd highly recommend taking on professional indemnity insurance (got mine from Blyth Valley).

    Also, get a separate bank account and save a percentage of money each month towards your tax bill. I can't stress this enough: save for tax!! This time last year, my accountant revealed that in January 2009, I would owe the tax man £9k. And I had nothing saved. Luckily, a few big jobs came in and I was able to pay it in time, but it really fecked me up for a few months.

    The Inland Revenue are actually really good at helping with any questions: make sure you register as self-employed with them, and ideally, find yourself an accountant who can help you set things up properly too (ie they'll talk you through what you've introduced into the business, such as your entire Apple lineup etc, and how that then would affect your taxable income etc).

    You don't have to register for VAT until your turnover exceeds £68k per annum (as far as I know) but depending on who your likely customer is, it can sometimes be advantageous to do so; if you always deal with VAT-registered businesses, for example, then it won't make you seem more expensive than the competiton, and would save you some money when you next whip out the credit card at the Apple Store. FreeAgentCentral can also tell you what your VAT return is, and filing it online is a piece of piss.

    I'm pretty sure there's more, but that might give you something to chew on...
  3.  
    I'd second freeagent, its been extremely useful for me.
  4.  
    Good advice, thanks!

    How easy is it to get a new bank account? Do I just call up the bank and ask for a business account?
  5.  
    Abbey run a free business account, arrange to go in a sign up for one.
    • CommentAuthorjg9 says…
    • CommentTimeOct 22nd 2009 edited
     
    save for tax!! This time last year, my accountant revealed that in January 2009, I would owe the tax man £9k

    I'm shitting my pants about this at the moment, not been anywhere near strict enough with putting cash aside.

    How easy is it to get a new bank account? Do I just call up the bank and ask for a business account?

    You'll probably have to make an appointment and go into the branch. I'd ask yourself whether a business account is necessary, if you trade under your own name don't bother, just cancelled mine, £30 a month I was being stung for, just use a separate current account now.
  7.  
    Is there any legal reason why I need to use a business account? I do have a spare current account I could use if it doesn't matter.
  8.  
    If you're simply gonna invoice people in your own name, then no, I don't think there's a legal requirement. But if you're gonna be "trading as Gecko Design" then I think the account needs to be in that name...
  9.  

    Regarding business bank accounts, you may run in to issues if you have a less than perfect personal credit history.

    I set up a limited company a few years back to handle my (limited) freelance earnings, but was refused a business bank account by several institutions due to my personal credit history. Ultimately it doesn't matter as long as you can mange and account for the money appropriately, but it's worth bearing in mind.

    Just FYI.

  10.  
    http://www.darwinpay.co.uk/the-tour.php?About-Darwin-5

    anybody heard anything about the above type of pay maximisation - legit or not?
  11.  
    Look at setting up as a LLP rather than Ltd. or Sole Trader. Get all the benefits of being self employed with the protection of a limited company. Rather handy if you cock everything up.
  12.  
    That Darwin place just looks like another umbrella company.
  13.  
    ...with an increase in gross takehome of 14% it may well be just another umbrella but if it's legit then I'd perfer the 14% come to me than the gov
  14.  

    One thing that I've wondered about is regarding your trading address.

    If you're renting a house/apartment, I think it's likely that you can't use your home address as your business address (check your rental agreement) as it has implications on buildings insurance and if you were to go bankrupt or anything, your landlord would be fucked.

    So you'd need to find an official address to run your business from.

  15.  

    What about your accountants address?

  16.  
    One thing that I've wondered about is regarding your trading address.

    If you're renting a house/apartment, I think it's likely that you can't use your home address as your business address (check your rental agreement) as it has implications on buildings insurance and if you were to go bankrupt or anything, your landlord would be fucked.

    So you'd need to find an official address to run your business from.


    Think that's only if you're Ltd company.
  17.  

    If your self-employed (sole-trader) do you need a legal "trading address" like you do for a Ltd? I was under the impression you didn't.

    I certainly don't put my address on most things as I work from home, and I'll be buggered if clients are just going to 'pop round' while I'm doing the hoovering... one has tried to after getting my address from a whois record (!) He was swiftly told where to go..!

  18.  
    I'm a Sole Trader and I've never put forward a trading address to my knowledge, the only thing that has my address on is my invoices.
  19.  

    What about your bank account and when you register with HMRC. You have to give your address and business address for both and as you're a sole trader YOU are your business, so your address is part of that.

    If a client comes round your flat (if is your registered address) and trips over a floorboard or something, you could be sued, and it'd come out of your pocket.

    The advice I've read is conflicting: one school of thought says that if you're working form home your business address must be your home address. Another (more convincing, to me anyway) school of thought says that you can use whatever address you want (accountant, lawyer, whatever) as your business address.

    As I said before, look over your rental agreement, as it may well say you are not permitted to run a business from your address (and while you can probably talk your way out of it in most scenarios, the one where HMRC and your bank have your address on record isn't one of them).

  20.  
    I work from home, but the address on my invoices is a registered office address in Belfast, so any cheques etc go there. Bank statements etc do come to my home address, and as far as HMRC is concerned, my home address is listed with them too.

    Jord is quite correct about a client coming to your home address and injuring themselves, but my understanding of that scenario is that, even if your home address is never listed on any documentation, you'd still be liable. So it makes sense to have Public Liability insurance for just such a scenario.

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