Self-employment in the Real World
In a recent post we looked at some statistics around self-employment. So what’s it really like at the sharp end? We asked a number of people about self-employment.
The buck stops
As well as doing whatever it is you do to earn a crust you have to do the sales and marketing, the administration, the business management and the accounts, you have to send the invoices out at the end of the month to cover all your costs and pay your wage.
Depending on your life stage it is probably wise to consult an accountant about you pay yourself, it may be advantageous to use PAYE. You may make enough money to pay a bookkeeper or accountant to do this work for you but it is smart to take a keen interest in this aspect of running a business.
Once you have informed HMRC that you are running a business you will file your accounts and payroll records online via your accounts software. Welcome to a whole new skillset! You’ll file your accounts with Companies House and your Company Tax Return with HM Revenue and Customs. You can get your accountant to do this for you but remember that you’re still legally responsible for your company’s records, accounts and performance.
The simple life
Once you are your own boss you will find your attitude to hours and holidays changes. You don’t get paid time off any more. If you want health insurance you will have to buy it, the same goes for training courses and new equipment. You can offset reasonable expenses against the company and thereby reclaim VAT on your new equipment and so on.
On the plus side you probably won’t miss office politics and working with hotshots, dullards and energy-sapping time-servers. There are plenty of drains on your time when you are self-employed but you need to keep them firmly under control. Having said that, some people hate working on their own and really miss the watercooler moments. Working on you own may mean you have nobody to bounce ideas off, to brainstorm with, and to chat about the footie with and so it can be lonely.
Business development can be hard work and networking is something you may need to make time to fit into your schedule. You will find you spend time and energy on providing quotes for potential customers and then don’t get any work. Never count on getting work until it actually comes in. Don’t give too much away for free if you are asked to assess a project or design a solution. Seriously, potential customers may ask for a detailed proposal with ideas as to how to solve their problem, a good way to get a lot of free ideas and suggestions on how they should do things. Limit your proposals and keep things high level until the contract is signed.
Freedom to juggle
One of the worst aspects, particularly during lean times, is not always knowing how much work and thus money you have coming in. Whether you have a lot of work or don’t think you have enough lined up it is a worry and there are only your own resources to fall back on. In which regard – there is no human resources manager to remind you to keep your qualifications and certifications up to date and to plan development activities so you grow professionally. This may be particularly important if you want to grow the business.
During busy periods you may have to do some serious juggling, working weekends and unsociable hours. Work-life balance can suffer, especially if you work from home. I tend to switch off the computer at 5.30 or 6 p.m. On the good side I don’t have to commute now and I don’t have to wear shoes unless I go out. You can flex your time much more easily and fit household responsibilities and other commitments around your work, go to the gym in off-peak hours, walk the dog when the park is quiet. You have more choice and freedom but also more responsibility, you are the decision-maker and all the mistakes will land at your feet. But, and it’s a big but, you get all the benefit of your hard work.
A couple of our correspondents said that they found it energising to work with a diversity of clients of different sizes in a range of sectors on some really interesting projects. One cautioned that it can be tough finding the right people to work with, he had some bad experiences working with associates who initially he thought were OK who then turned out to be less than nice to know.
In conclusion, a quote from one of our associates: “Most of the time you get out what you put in, it's made me a stronger person to know that”.
For further help and guidance on Self-employment please contact Career Directed Solutions on 0333 240 8115 or email email@example.com
Posted: Friday 20 April 2018