In today's job market, an increasing number of people are balancing the demands of full-time employment with the entrepreneurial spirit and freedom of self-employment. 

In 2024, 43% of Brits earned supplemental income through side hustles, averaging earnings of £900 per month.

The gig economy has made it easier than ever for people to start their own businesses, and many individuals are seizing the opportunity to earn additional income or pursue their passions. However, juggling two roles can be demanding. It requires careful planning, time management, and financial discipline.

Whether you're a side hustler looking to grow your business or a full-time employee exploring self-employment, understanding how to manage having a foot in both worlds is paramount to succeeding.

This article will explore the pros and cons of being both employed and self-employed, provide practical tips for managing time and finances, and offer advice on how to maximise income from both roles. We also have a range of other articles dedicated to doing a side hustle successfully, from things you should know before starting a side hustle to how to navigate HMRC's "side hustle crackdown".

Is it worth it? (pros and cons)

While being both employed and self-employed can provide additional income and opportunities for growth, it also presents challenges such as time management and financial complexity. Below is a list of both.

If you haven't quite found the right side hustle for you, we recommend checking out our top side hustle ideas for this year to get started.

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Time management tips

Effective time management is central to balancing both roles. Prioritise your task load, set boundaries, and automate where possible to improve productivity and reduce stress.

Prioritise and plan:

To effectively manage your time, identify the most important tasks in both your employed and self-employed roles. Allocate time to each role based on priority and use productivity tools to track deadlines and stay organised.

Set boundaries:

Create clear boundaries between your employed and self-employed roles. Dedicate specific time blocks for each role and avoid mixing them during work hours. This will help you maintain focus and avoid burnout.

Automate and outsource:

Streamline your workflow by automating repetitive tasks and outsourcing smaller tasks to freelancers. This will free up more time for high-value work and reduce stress.

Avoid burnout:

Take breaks, schedule downtime, and consider delegating tasks if possible. Prioritise your well-being and avoid overworking yourself.

Tax considerations when you're both employed and self-employed

When working simultaneously in employed and self-employed roles, managing your tax obligations becomes a key challenge. By keeping finances separate, understanding tax structures, and claiming deductions, you can lower your tax burden and ensure compliance. 

Separate finances:

• Maintain separate bank accounts and financial records for your employed and self-employed income.
• Track expenses related to your side business, such as equipment, travel, and office supplies, for potential tax deductions.

Understand tax obligations:

• If you're self-employed, you may be responsible for quarterly tax payments.
• Consult an accountant or use tax software to manage the different tax structures for both roles.

Take advantage of deductions:

• Claim deductions for home office expenses, internet, and software tools used in your self-employed business.
• Stay informed about tax laws and regulations to ensure you're taking advantage of all available deductions.

Tips to maximise income from both

To maximise your income from both your employed and self-employed roles, focus on high-value clients and projects that generate a substantial return on your time and effort. Leverage your skills across both roles, applying your expertise to enhance your side business and vice versa. 

For example, if you're employed as a marketing manager, use your skills to create effective marketing campaigns for your self-employed business. Additionally, explore passive income opportunities, such as online courses, memberships, or digital products, that can provide a steady stream of income and reduce your reliance on active work.

Combining your employed and self-employed activities wherever possible will add value to the service you provide in both, thus boosting your earning potential.

Transitioning the side hustle to full-time employment 

Eventually, you may well be ready to take the leap and make the self-employed side gig a full-time career. When you do this you need to do some essential preparation beforehand to set yourself up for a smooth crossover:

1. Test the viability:

• Before transitioning, test the financial viability of your side hustle by evaluating if it can sustain your desired income.
• Consider if your business has long-term growth potential.

2. Save and plan:

• Build an emergency fund that covers 6-12 months of living expenses before you leave your full-time job. This will provide a cushion in case of slow business periods.

3. Gradual transition:

• Don’t rush to quit your full-time job, instead, scale your side business gradually. Reduce your full-time hours if possible or take a part-time role as your self-employed income grows.

4. Secure a client base:

• Have consistent, repeat clients or a steady flow of income from your side business before taking the leap.

5. Prepare for uncertainty:

• Be ready for the emotional and financial ups and downs of self-employment, and ensure you have a business plan in place for sustained growth.

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Striking the balance

Balancing life as both employed and self-employed can be a rewarding but challenging experience. With the right strategies—such as effective time management, financial planning, and maximising income—you can enjoy the benefits of extra earnings and personal growth.

While the demands of handling two roles can be intense, careful planning and setting boundaries can help you avoid burnout. If your side hustle grows into something sustainable, transitioning to full-time self-employment is a viable option, but it requires patience and preparation.

After considering all the points covered in this article, the balancing act is worth it if approached with intention and foresight.

Ready to dip your toes into your side hustle?

If you're looking to get started earning money on the side of your full-time job then you need to make sure you're being tax compliant. Failing to declare or incorrectly declaring your income can lead to hefty fines and penalties. This is why it's always best to work with a reputable online accountant, like us!

If you're interested in how we can support your freelance/ side hustle journey, then be sure to check out our dedicated sole trader accounting page. We even offer Self Assessment as a stand alone service if you're in need of tax return support.

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