People become self-employed for a number of different reasons. In some cases, it can be the nature of a job, such as working as a contractor or for a company that employs drivers and delivery people on a self-employed basis. For others, it may be because you have an idea for a new business or want to work for yourself. Whatever the reason, there are various issues to be aware of before you become self-employed.
If you want to work for yourself, you can decide whether to work as a sole trader, a partnership or as part of a limited company. There are advantages and disadvantages to each of these options, and some will require more organisation than others.
If you want to create your own company, check to make sure that the name of your business isn’t already taken. It may sound obvious, but people have been caught out because their company name had already been taken (and indeed some very high-profile businesses have been caught out in this way).
One issue people can fall foul of without realising is accommodation. While working from home can be more convenient, in some cases, this may go against the tenancy agreement of your home. This can be in terms of working from home but also in terms of storing items in communal areas, meetings taking place in shared accommodation etc. Remember to check your tenancy agreement, or to contact your landlord or lettings agency if you are not sure.
One important aspect of self-employment is taxes. You will usually have to submit a self-assessment tax return. You can submit a paper version by 31st October or in January for the online version. In either instance, you need to ensure that any tax owed is paid by 31st January in order to avoid the risk of paying a fine.
Getting the right insurance is important. For example, if you open a pop-up shop, then you should get public liability insurance, so you are covered in the event of someone being injured. You can get coverage for one-off events, or if you do regular events, then you may wish to consider getting annual coverage.
One potential issue with self-employment is employment rights. This is being assessed as more companies work on a “gig economy” basis, seeing how to protect people who work to these contracts. It is recommended you look over any contract before you sign it.
As with other employees, self-employed people are still protected in terms of health and safety and discrimination. This applies to people working for you as well.
We can help
If you are concerned about the possible legal implications of setting up a new business or need more advice, please contact us today. We have a number of specialist legal advisers that can guide you through the process and help ensure that your business is ready to go, so you can get the most from your self-employment.