The Great Hunt: Help for those thinking about self-employment

caressamba wrote: »

I'm hoping to do this next year but it's really scary! I would potentially be walking away from over 30k in salary which feels foolish (hence not doing it before), but it's probable my job will come to an end in May. I'm particularly worried about working out how much to pay myself and how to do it. The industry I would be going into (photography, mainly weddings) would be seasonal (though I intend to do other types of photography which will be all year round). Additionally, people tend to pay by deposit and then balance payments, which can often be 2 years apart, and then there are fixed costs to come out of the total amount e.g. albums - I really struggle with working out how to pay myself with this system!

I would be interested to hear from anyone who has done the same

I work full time (in the NHS) and am a self employed part time photographer too. If I were you I would dive right into the photography business right now to get your feet wet before your job ends. I would say it would be really hard to earn £30k from your first year of photography in business, but not impossible. Do as much as you can before your job ends to see how viable your business can be. I recommend reading as much as you can about photography business and pricing to prepare yourself for how much you need to charge to make yourself profitable.

Couple of websites I recommend reading through are:
http://www.profitfirstphotography.com/about/
http://www.themoderntog.com/
http://photographyconcentrate.com/

Hope that helps!

Receipts: they are vital for a) claiming against allowable expenses and b) proving you spent the money.

Keep a file for your receipts starting immediately, and either write them down in a book or on-line draft, or write on the receipt itself what it's for. Or both.

You'll be amazed how quickly it mounts up - petrol, parking, supplies, phone calls, customer meals / teas bought etc etc etc.

Keep each tax-year separate.

If you must chuck them in a carrier bag (bad idea!), then at the very least, start a new bag each April 6th. And LABEL the bags clearly!

It gets very confusing if you only file in January for the previous tax tear which ended in April, giving you a year and nine months you need to hang on to your receipts ready for filing by that January 31st deadline.

And last but not least, once you've filed your tax return, you need to keep your receipts safely filed away with your tax return - if filing online, best to keep a printout with a note of your HMRC submission receipt number, the very long one. You need to keep your completed return and receipts for at least a couple of years:

from HMRC website: http://www.hmrc.gov.uk/sa/record-keeping.htm#3

How long to keep your records
You must normally keep your records for another year after the online tax return deadline of 31 January, in case HMRC decides to check your return. The same date applies even if you've sent in a paper tax return.
An example
The tax return deadline for an online 2013-14 return is 31 January 2015.
You send your tax return in before this deadline.
You need to keep your records until 31 January 2016, one year later.
But if HMRC send you, or you send back your tax return very late, you may need to keep your records for longer. You need to keep them until the later of:
one year after the 31 January tax return deadline
fifteen months after the date you send your tax return
If HMRC has started a check
You may need to keep your records for longer if HMRC has started a check into your tax return. In this case you'll need to keep your records until HMRC writes and tells you they've finished the check.

There are three critical things in business.

1. Getting the work
2. Doing the work
3. Getting paid for the work.

If you fail on just one of these, your business will simply fail.

You need to be focused on what you do. Don't dabble in things which you don't know about or are not confident. If you don't know something or can't do something, tell your client. They will admire your honesty and it saves the relationship turning sour.

Think carefully about how you market yourself. I used to 'advertise' in the true sense of the word in the local papers when I started in business 13 years ago. I always got work from it. I last advertised in this way last year and got zero response. Now I don't use 'hard' advertising at all. I have a website, which is optimised and I have an enhanced listing in yell.com. Both bring in regular clients. I now use2 main ways of generating new business. The first is social media (facebook, linkedin, pinterest. I find twitter of no value in my industry). Facebook is by far the biggest developer of new leads. I attended a course on facebook marketing 2 years ago and last year could attribute just on £15k of work from it. But you have to do it well and keep at it. It takes time and is a slow burn. The second way is networking groups. Again it takes time, but worth it. Remember: people buy from people. Use every networking event as an opportunity to get to know your potential clients. Don't sell anything but use the events to allow people to gain confidence in you. Again, its a slow burn, but it will lead into things.