Get started - the serious stuff

This is your basic guide to the nuts and bolts of being self-employed. Here you will find information about the legal structures you can use, how to pay tax, budgeting your money and finding a workspace.

Choosing a legal structure

When you set up as self-employed you need to decide what legal structure you want for your business. Read on to learn more or watch this video - Legal Structures Guide.

 

There are various structures to choose from, but the most common three are:

 

Sole trader - just me

  • This is a simple structure to set up.

  • There are no charges, and it is easy to get out of if you decide self-employment is not for you.

  • You will submit a self-assessment form each year and pay taxes each January. 

  • The biggest issue with being a sole trader is that if your business fails, you will be personally liable for any debt.

A partnership - me and someone else

  • This is the best structure if you intend to work with other people.

  • The partnership shares the profits and losses on an agreed basis.

  • You are jointly liable for any debts owed.

  • We recommend using a solicitor to help you draw up a partnership agreement which will cover things like intellectual property and other assets. Or you can become a Limited Liability Partnership (LLP), which has limited personal liability.

Limited company - me and my company

  • A limited company (Ltd) is a separate legal entity set up through Companies House, and there are registration costs involved.

  • Being a company offers you more protection if your business fails.

  • It often means tax advantages.

  • When businesses start to grow financially or employ people, they often change their status from sole trader status to Limited Company at that stage.

  • We recommend you contact the enterprise team get support if you wish to form a Ltd company. 

Getting some insurance
  • You are responsible for insuring your business, regardless of the structure.

  • As a business owner you need to assess your insurance requirements, including liability insurance, life and health insurance and professional indemnity insurance.

  • Try using Simply Business Insurance to get an estimate to insure your business. 
     

Paying tax and national insurance

Finding a workspace
You can work from home, on campus or in the library; or you can rent:

 

To discuss access to The Assembly Hall or Launchpad please contact Lizzie Dixon


Planning, financing and budgeting

  • Planning your finances and budgeting is crucial as a self-employed person.

  • Create a set up budget (word template here) The money you need to invest up front to get your enterprise off the ground.

  • Use our all in one mega planner to complete the following: 

    • Business Plan. Should detail your blueprint for how your business will operate. 

    • Personal Survival Budget  The money you need personally to survive each month, its liklely your business will not make money immediately. 

    • Your Sales Assumption help you to think about sales income and cost of sales. Whether you sell a product, service or your time you need to understand how and when your business makes money. 

    • Your Cash Flow forecast helps you to plan for you business or self-employment, you will need to understand your monthly "cash in",  "cash out" and money "in the bank". Sometimes it takes upto 90 days for a customer to pay, but you will still have costs every 30 days. 

  • Get a separate bank account to manage your self-employed income.

  • You may decide to hire an accountant to help you manage your finances and prepare your end of year tax returns.