Although you might be getting carried away with dreams of becoming your own boss, going self-employed requires an unbelievable amount of hard work and dedication. There are plenty of benefits of becoming self-employed, but it’s not a case of simply using it as an escape route from a job you can’t stand. Self-employment should only be considered by those with a determination to succeed.
However, you certainly shouldn’t feel intimidated by the prospect of working for yourself, since the latest ONS figures show that 15% of all UK workers are now classed as self-employed. In fact, the UK is currently home to over 5 million self-employed workers, with figures continuing to rise as people finally remove the shackles of 9-to-5 working.
But why exactly has self-employment become so popular in the last 20 years?
Benefits of Becoming Self-Employed
Brookson have found that the top benefits of becoming self-employed are:
- A Better Work/Life Balance
- Flexible as Remote Working Options
- Additional Tax Deductions
- Setting your financial worth
And of course a level of independence and freedom.
So let’s take a closer a look at what you could discover are the real benefits of becoming Self-Employed:
Better Work-Life Balance
Traditional workplaces can be incredibly restrictive when it comes to schedules and working hours, with the monotony of a 5-day week causing many to start exploring possible self-employment options. More importantly, such rigid working schedules ultimately lead to a poor work-life balance, making it incredibly difficult for employees to work around their personal lives and other obligations.
When working for yourself, however, you’ll have complete control over your time schedule and workload, allowing you to work at a time and place that best suits you. Instead of worrying about the rush hour traffic or running out of holidays, the flexibility of self-employment allows you to set your own timetable and calendar; helping you achieve a much stronger work-life balance.
Flexible and Remote Working
Of course, when you’re self-employed, you can work in whichever environment best suits you. You can rent an office, find a shared workspace or even venture out to coffee shops and cafes. However, without question, one of the biggest appeals of self-employment is the opportunity to work from home.
Not only does remote working allow you to completely avoid the rush hour traffic and adverse British weather conditions, it can also help you save money on travel costs and make you much more productive. By avoiding unnecessary distractions and setting up a workspace which is completely tailored to your requirements, working from home can keep you more focused and ultimately improve results.
Although self-employed workers pay tax at the same rate as regular employees, they’re only taxed on their profits, rather than their overall income. Since you’ll be working for yourself, you’ll be able to reduce those profits by claiming expenses and allowances; thereby reducing the amount you can be taxed on.
However, there’s obviously strict legislation in place to prevent people from claiming tax relief illegitimately, and you can only make a claim on items used for business purposes. For example, you can claim allowances on fuel, new office equipment and the costs of running your business premises (even if you work from home).
So, as long as you’ve kept the necessary paperwork and can prove assets are business-related, you can claim your new laptop and electricity bill as an expense—rather than adding those figures to your taxable profits.
Earn Your Worth
After putting in a lot of hard work and finally finding their feet, self-employed workers stand to make a lot more money than those hired through traditional means. To be more specific, a 2017 study found that a typical self-employed worker makes £5,000 a year more than the average national salary, despite working 10 hours a week less.
When you’ve got a specialist contractor accountant managing your books and dealing with your taxes, the financial benefits of becoming self-employed can be absolutely astonishing. Considering sole traders and freelancers can take home everything they earn (minus expenses and taxes), self-employment provides you with the opportunity to finally earn what you’re worth—not what somebody else decides to pay you.
When you’re able to fully reap the rewards of all your hard work, job satisfaction levels will inevitably be sent through the roof. However, if you’re planning on becoming self-employed and require some help managing your finances, then contact us today for your FREE consultation!