Pros and Cons of being Self-Employed

Category: Entertainment

Presentation Description

If you’re considering going self-employed, it is important to know what you’re getting yourself into before making any decision. Here is a list of essential pros and cons you need to know about being self-employed.


Presentation Transcript

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Pros and Cons of being Self-Employed Pros and Cons of Being Self-Employed If you’re considering going self-employed it is important to know what you’re getting yourself into before making any decision. Here is a list of essential pros and cons you need to know about being self employed UK. Pros of being self-employed 1. Simple start It’s the simplest option to start a business in the UK. All you have to do is register as self-employed with HMRC by the 5 October of your business’ second tax year. No need to spend money on registration and the process is pretty straightforward. Go to The Complete Guide to Becoming Self- Employed to learn more.

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2. Easy management Even though you are the person in complete charge of your business you won’t need to be concerned with the many regulations other types of business like limited companies have. All you have to do is the bookkeeping of your income and expenses in order to file your annual self- assessment tax return correctly. 3. Flexibility You have the flexibility to decide how your schedule is gonna look like what clients you want to work for whether working with people is an option for you and where you want your job to be located. You can work from home from a nice cafe or travel to exotic places and do everything from your laptop and/or phone. You get to make a wise use of your time and do what you are really meant to do. 4. Do what you like You don’t have to wait until you’re too old to do what you were born to do. It can look like a big risk you’re taking but your life fulfilment depends on you living in your purpose. If becoming self- employed is part of it go for it Work hard don’t be afraid do things the right way and you will see the results. 5. Test ideas You can invest in exploring your creativity test new ideas and see what products services and strategies work best for your business. You have the flexibility to make changes in order to work more effectively. 6. Tax advantages You can deduct certain costs like travel expenses utility bills such as gas and electricity telephone and broadband when you work from home insurance and other business related expenses when filing your tax return. This can help you significantly reduce the amount of tax you pay. 7. Earn more Depending on what service you’re offering or what product you are selling you can earn much more than what a normal job pays you. For instance if you are a freelancer offering a service in high demand such as graphic design and web development or you’re selling trendy products such as the latest fashion or offering a service that people will always look for such as cleaning gardening removals you can be sure you will make good money if you market yourself in the proper way. It is really important you study the market to see what’s on demand and how you can take part in it.

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Cons of being self-employed 1. Greater risk Unlike limited companies where the owner’s private assets are separate from the company’s assets you and your business are seen as one single entity. In other words there is no legal distinction between the owner and the business if anything goes wrong for instance your business is in debt it will be counted as your personal debt and creditors have the right to take your personal assets until everything is paid. But if things are done the right way you will be very far from trouble 2. Responsibility It is your responsibility to keep a record of all your transactions and to ensure you have the right amount to pay for tax when it’s time for Self-assessment Tax Return. It requires a lot of diligence to keep everything up to date if it’s too much to take on board you can always pay for an accountant to do this for you. 3. No Guaranteed Income The beginning can often be challenging when finding your way in the market and if you are looking into self-employment as a full-time thing your income will not be guaranteed since time not spent working means time not spent earning and no clients equal no money. However if it is a part-time option whilst you’re still working for someone else at least you will have a secure source of income while you get your business started. 4. Less Assistance You will not be entitled to employment rights such as sick pay annual leave maternity leave and minimum pay and you will not be part of the workplace pension schemes either which means that you will have to make your own pension arrangements. In addition if you have an irregular income it can be more difficult to get a loan rent a property and keep up with living expenses. 5. Isolation If the field you’re working at requires you to often be on your own self-employment can be quite isolating and you can end up doing more hours than a normal 9 to 5 job asks of you. However if it is your passion and you’re up for the sacrifice there won’t be anything more rewarding than doing what you love and earning from it

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