You come up with a great idea for a business and you are excited to get things up and running. You do your research; buy what you need and launch your business. With hard work and a bit of patience, your first orders start coming in, and you’re seeing some payments coming into your bank account. Exciting!

Then the doubt sets in. Is this how people should be paying you? When should you declare their payments? Do you need to contact the authorities to tell them you’re self-employed now?! It’s a lot. It can feel mind-boggling.

Becoming a sole trader (otherwise known as working for yourself) is enough of a rollercoaster, then you’ve got to add finances into the mix. Suddenly paying the correct amounts of tax and National Insurance are your responsibility, there’s no employer to sort it out for you.

You’re definitely not alone; there were approximately 4.37 million self-employed people in the UK in the three months to January 2021. First, you need to register as self-employed by October 5^th of the second tax year of your business. There can be varying requirements depending on industry, so it’s important you take some time to look into yours.

The biggest piece of advice we have for new sole traders, is to create a process for your paperwork and invoices and keep on top of it from the off. It might seem like something you can put off, but it is much easier to start as you mean to go on, rather than having to go back retrospectively and rely on your memory! Invoicing, receipts, and expenses should all be tracked as a benchmark. It’s also worth making sure you understand basic accounting processes and sound financial habits, in order to recognise where your business is at. Upskilling yourself will pay dividends in the future, literally!

Why would I need an accountants’ help?

Of course, we might be slightly biased, but we’ve done thousands of hours of accounts for self-employed individuals. Mostly the reasons they use us come down to two main factors: the value of your time and the value of our experience.

The value of your time

If you make use of accounting services, you’re freeing up your own time. That’s a given. As a freelancer or self-employed individual, we know how busy it can get. Doing everything from the sales to the cleaning, with often what feels like no time to work on the business, rather than just in it! (We’re a small business ourselves after all). Many people at the first mention of finances switch off, so you can be forgiven if you feel it’s an area, you’re not very familiar with. If this is the case, then when you do find time to do the accounts, it might not be the most efficient of processes. That’s understandable, you’re an expert in your field, who said you’d need to be an expert in finances too?! If you’re in doubt as to whether you might need an accountant, work out the hours you last spent completing your accounts and forms, then compare that to your potential revenue in the same period. What would serve your business best?

The value of our experience

That’s just the beginning. See, in these thousands of hours of work we’ve done for the self-employed like you, we’ve learnt a fair amount! We’ve seen the same issues and errors time and time again. More than this, we know how to make your finances work for you. Tax can be a minefield, financial planning and ensuring compliance is all our day-to-day. Changes come thick and fast when it comes to tax rules, we’re on top of these and have an in-depth understanding of complex tax legislation and reforms.

So, the first part is all about ensuring you’re fulfilling regulations and avoiding complications. Then the real benefits of accounting services come in – Market expertise, financial planning, grant applications, pensions to name just a few. In other words, support to push you forward. Accountants should be there in your corner, guiding you and helping you overcome obstacles. Enabling you to build the business you have envisaged and exceed even your own expectations.  We can give you a more complete view of your business, help you develop a strong business plan and remind you to follow through. Getting started often isn’t the most difficult part, keeping momentum and staying on top of everything is the key. Funnily enough, we’re good at accountability!

The world of finance is constantly changing, and if you’re not on the bus, it will leave without you! However, the value of a strong relationship between accountant and self-employed is about much more than just compliance. Being self-employed can be a lonely position to be in, we understand this and more than anything, aim to get you excited about where you’re heading and how strategic planning will get you there!