Working for yourself and creating a start-up can be an exciting experience particularly due to the freedom that comes with freelancing. Working from home or in your own office allows you the time to accurately plan on activities that you consider beneficial. Working for yourself has its benefits as well as challenges that can be avoided by considering specific factors.
Here are 5 things to consider when creating your start-up;
- Consider Registering With HMRC
Once you become self-employed in the UK, you become responsible for paying your National Insurance and Income Tax. It is thus important to register with HMRC by 5th October of every year. It is easier to register with HRM before starting your business as it enables you to assess tax returns for every year from start-up date. When your business starts making a profit of € 5,965 and more a year, you need to start paying for Class 2 NIC which is €3 per week.
- Register for VAT
Once you register for VAT, you have to pay 20% of the price of services and products you sell to the government. It is compulsory to register for VAT before reaching a threshold of €77,000 because failure to pay will result in penalties of up to 15% and you still have to pay for VAT. Registering for VAT also makes your company look decent as it is a norm for every recognized company to pay VAT. When you are registered for VAT, you can reclaim 20% of every service or product you outsource making it a great bargain for your start-up.
- Get a Business Bank Account
It is important to register a separate business account for your start-up as it will be difficult to track business finance records in your personal account. Your business bank account will have the name of your business making you look professional when giving invoices and cheques. Another advantage of having a business bank account is that your business will not attract the attention of Internal Revenue Service that is keen to conduct audits on susceptible companies. Your business account will enable you or any other revenue bodies to conduct clear audits on your business financial records.
- Insure Your Business
According to your niche market or specification, the Law requires you to have specific insurance policies to cover your business. For example, if you have employees, you need the employer’s liability insurance whose terms should clearly be understood by every employee. Another insurance cover is the Public Liability Insurance which covers injuries and damage inflicted on customers who visit your business premises. If you provide professional services which would sometimes get you sued if clients are unhappy, you need to get insured for Professional Indemnity. Check out ByteStart’s Guide on the types of insurance covers you should have for your start-up.
- Get Business Broadband for Reliable Web Services
Today, every start-up should be visible online as the e-commerce is an effective platform for marketing products and services as well as making sales. The business broadband package has more vital features for business activities than the home broadband package. The business broadband package has 4 options that are suitable for small businesses and office. The options include; simply business broadband €321 a year, unlimited business broadband costing €214 for the first year and €300 for the following years. We also have the Unlimited Broadband + line rental that costs €370 for the first year and €430 for following years, and finally the Business Broadband /24 month contract/ that costs €189 for the first year. View all business broadband offers
- Consider Hiring an Account
As a freelance entrepreneur, you should consider hiring an accountant as your partner so that they can lend you their financial expertise and business perspective to grow your start-up. Hiring an accountant relieves you from tedious financial recording and bookkeeping. This allows you to have a work and life balance instead of getting stuck at work all the time. Accountants understand tax and other financial factors of growth which will represent your start-up as professional.
You will need to consider the above factors to be able to run your start-up comfortably. Include them in your project plan and your start-up is more likely to succeed.