Setting up as freelance from home

[askingalways]

This year I am setting up as working freelance, working mostly from home.
I will only need my laptop and the hours worked will be flexible apart from one bi-weekly meeting where I will go to the office.

I would appreciate any practical advice or things you wish you had known when you started up.

Or point me in the direction of blog posts or websites you've found useful would be fantastic.

Thank you!

How are you going to set yourself up? Sole Trader vs Unbrella Company vs Limited Company? The answer to that will dictate the sort of advice you’ll get.

Also, how will you get work? Will you have medium/long term contracts with organisations or will work come in piecemeal? Will you need to do ‘sales’ or is it not that type of work?

Thanks for replying @QueenDoris

I will be a sole trader, working freelance for another company on medium/long term projects.

You will need a time tracking app.

The ones I have used are Toggl and Workflow Max.

Keep track of your expenses on a weekly basis, whether they are ones you can offset against the company or reclaim from your client.

Invoice monthly, on the same day each month (I always do the 1st, or the first working day following).

The gov.uk website is a useful starting point: www.gov.uk/set-up-sole-trader

Things to think about...

• Register for self assessment. You will need to keep money aside to pay your tax bill at the end of the year.
• Think about if you need an accountant, depends on your confidence and tax complexity
• Do you need business insurance? Your contract may make it a condition, but also remember as a sole trader you are personably liable if anything goes wrong
• Think about personal insurance. What happens if you can't work for some reason? Remember you have no sick pay etc
• Do you need to be VAT registered?
• Do you need to set up a business bank account? As a sole trader you don't have to, but it may make it easier if you do depending on your cash flow
• Think about what you can claim as business expenses to offset tax

That's an initial brain dump

I will be a sole trader, working freelance for another company on medium/long term projects.

IR35 rules come in for all - not just government this year. Have you looked at them? Medium/long term contract sound In the scope of IR35.

@HairyDogsFeet IR35 is not relevant for a sole trader - IR35 legislation relates to working via an intermediary (most commonly a limited company).

Have a look at this website www.talentedladiesclub.com/ for general advice - there's quite a few articles about working at home.

If you work freelance for one company, aren’t you an employee and not self employed ?

@WH1SPERS

If you work freelance for one company, aren’t you an employee and not self employed?

Not true. You can be self employed with a contract working for a single client for a long period of time. Conversely you can be deemed to be an employee even if you have multiple short term contracts. However having several customers could help

The measures for if you are an employee are complex, sometimes a bit unclear and different for tax law and employment law. However broadly the key points to consider on self employment are:

Control Do you have the final say in how your business is run? Can you choose whether to do the work yourself or can you send someone else to do it (Substitution)? Can you choose when and how you work (or does your employer tell you what to do and when to do it?)

Integration Are you excluded from your Employer’s internal organisational matters, corporate training, staff meetings? Are you exempt from having action taken against you using the company’s disciplinary procedures and have no access to their grievance procedures? Are you excluded from company benefits and perks? Do you directly line manage company employees?

Mutuality of Obligation – Does the Employer offer work to you only if and when it is available? Can you decide when you will work and can you turn the work down that is offered? (or are both parties of a view that a contract of employment exists)?

Thank you Doris, that’s helpful.

No problem @WH1SPERS, glad you found it helpful

In OPs case, they have stated they are planning on working as a sole trader. In that scenario it is the employing organisation's responsibility to determine employment status. This is why often employers insist on you using an intermediary (i.e. limited company) as this put the onus on the freelancer to determine status. It is proposed that this is changed in April 2020 to move the onus onto the employer (this is already the case in the public sector). This is the IR35 change that is often (incorrectly) talked about.

We don't know the details of the work the the OP is planning on doing, nor anything on the contractual relationship, so we can't make any assumptions about their employment status