Taking the leap into self-employment can feel like an exciting but daunting step. Whether you’re dreaming of turning a passion into a business or just seeking some flexibility that self-employment offers, getting started is often the trickiest part.

To help we’ve compiled these tips for going self-employed, sprinkled with real-world insights and practical advice. But first, let’s cover some of the basics—what does it actually mean to be self-employed?

What’s the definition of going self-employed?

Basically, being self-employed just means that you are your own boss rather than working for someone else. It could mean running a business as a sole trader, setting up a Limited company, or working freelance across a number of projects. The key difference? You’re in charge of everything—from winning clients to managing finances. 

While freedom sounds appealing, self-employment also comes with responsibilities. You’ll need to register as self-employed with HMRC, handle your own taxes, and ensure compliance with regulations. 

As you embark on your self-employment journey, you might be wondering: is this the right move for you?

The benefits of going self-employed

For many, self-employment represents an opportunity to reclaim control. You set your schedule, choose the clients you work with, and even shape the direction of your work. 

But how do I know if self-employment is right for me?

Self-employment might be right for you if you’re looking for:

• Greater flexibility.
• The chance to earn more by cutting out the middleman.
• A way to turn a hobby or passion into a full time career. 
• More control over your working hours.

If any of these sound like your ideal way of working, then let’s explore our top tips for going self-employed to help you hit the ground running.

{{tax-guide}}

Your top tips for going self-employed

1. Find the right structure for you

Choosing the right business structure is one of the first decisions you’ll face. Do you want to operate as a sole trader or set up a Limited company? Each comes with its own pros and cons:

• Sole traders have simpler admin, but are personally liable for business debts.
• Limited companies offer more protection but come with extra paperwork and admin.

We’ve written an in-depth guide to help you decide whether a sole trader or limited company is right for you. We also have a number of dedicated guides covering aspects of the setting up process, including costs to set up a limited company and understanding the legal requirements of being a sole trader. 

2. Research your market

Understanding your potential clients or customers is vital. Who are they? What do they need, and how can you help? Market research can help you tailor your services, stand out from competitors, and set realistic pricing.

3. Create a business plan

A good business plan is like a roadmap. It doesn’t need to be overly complex but should outline your goals, services, target audience, and financial projections.

4. Set up your finances

Open a separate business bank account, keep records of your income and expenses, and start tracking everything from day one. This will make life much easier when it’s time to submit your Self Assessment.

If you’re wondering whether it’s actually necessary, we’d recommend checking out our article “Opening a business bank account - how and why you should do it”. 

5. Register with HMRC

If you’re self-employed, you’ll need to inform HMRC and register for Self Assessment. If this feels overwhelming, Crunch can help guide you through the process. 

6. Build your network

Networking can unlock opportunities you might not find otherwise. Join relevant groups, attend events, and connect with potential clients online.

7. Set realistic goals

Rome wasn’t built in a day, and your new business won’t be either. Break your goals into manageable steps and celebrate every win along the way. It’s worth checking out our ultimate guide on setting business goals and objectives if you’re new to being self-employed. 

{{cta-newsletter}}

8. Understand your tax responsibilities

Self-employment comes with tax duties, but the specifics will depend on your business structure (sole trader or limited company) and your turnover. 

Generally, you’ll need to:

• Submit a Self Assessment tax return annually.
• Pay Income Tax and National Insurance.
• Register for VAT if your turnover exceeds the threshold.

Your exact tax responsibilities will vary based on whether you're a sole trader or running a limited company. We have a range of articles covering this topic including “How do I work out my tax?” and “Self-employed National Insurance explained”. 

If you aren’t sure what applies, we’d always recommend getting professional advice from an accountant that’s familiar with your situation. 

9. Invest in marketing

Getting noticed is key. Build a professional website, utilise social media, and ask happy clients for testimonials to spread the word about your services.
‍

Making sure you’re compliant

Self-employment brings freedom, but it also comes with obligations. Ensuring you’re compliant with HMRC regulations, keeping accurate records, and meeting your tax deadlines are all essential. With Crunch’s online accounting software and dedicated support, we make managing your responsibilities simple, so you can spend less time on admin and more time building the business you love.

Ready to start your self-employment journey? Speak to Crunch today and see how we can help.

Book a call

‍