Freelance design... Can you help please?

katieksli

katieksli

Junior Member
Hello :) was wondering if you can help me out with a query I have please.

I would like to do some freelance work before going into full-time employment, how do I go about doing this in term of:

  1. Do I need to set up a business bank account?
  2. VAT?
  3. Self-employment tax forms?
  4. Do I notify Inland Revenue of self-employment?
  5. On average how much should I be charging per project?
  6. How do I draw up a project proposal etc?
  7. Are there any other legal stuff I need to know about, like binding contracts etc?

Any help on this/procedures in going about freelance will be great and very much appreciated :D

Katie
 
Hi Katie,

Welcome to DF :)

1. No, you can be self-employed without a separate business bank account as long as you track all income and expenditure for the 'business'.
2. No, VAT registration is only really necessary when your business sales for the year are over £68,000.
3. You register as self-employed with the tax man (within 3 months of starting trading) > HM Revenue & Customs:First steps to register as self-employed
4. See 3 :)
5. How long is a piece of string? It's dependent on your experience, skillset, clients, how you want to charge - hourly or per project on a quote basis.
6. Dependent on project and client to be honest, search on the forums for previous topics about this.
7. Take a look through previous threads in this forum (Running a Design Business)

Here's a useful article from Mark Boulton for some extra reading:
http://www.markboulton.co.uk/journal/comments/start-your-own-business

Hope that helps,
Greg
 
I'm going to add to number 2 as Greg's missed a little in my view on that but has covered the rest pretty well.

You can voluntarily sign up for VAT registration before earning £68000, this isn't necessary but when dealing purely with VAT registered companies they can claim it back so it makes no difference to them. Where it does make a difference is to you in that you can claim back VAT on purchases (ie things like paper, computers, software, petrol etc) that you use in your business (or a percentage if it's also used for personal use).

This does mean you will have to charge VAT to everyone meaning you may be slightly higher for non businesses but it may be something to consider.

There's a small difference in accounting (basically your earnings exclude the VAT) and you have to fill in (in my case) 4 extra forms a year detailing the VAT but for me personally it was a better option than not being registered as my software and hardware isn't cheap and I mainly work with businesses.

You also don't say if you're going to be buying in stock and reselling (ie like a shop) as this would also benefit from being VAT registered in my opinion.
 
Yep good point Levi, as you mentioned in your example, it can be worth voluntarily registering before reaching the £68k :)
 
Thanks everyone for all the information, especially the tax information - very useful :D

Another question regarding contract and ownership of design, in terms of drawing up a project contract, do you get clients to sign a project brief and agree to terms and conditions so that it's legally binding? How can/do you put copyright on completed designs?
 
The latest issue of Computer Arts Projects is packed with tips for starting up a studio. While this thread may be dealing with solo freelancers specifically, I found the info in CAP to be very useful in terms of general stuff about running a creative business- big or small!
 
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