Self employed loans

becw_2

Hi
I've been self employed for 1 year and before this I was a student for 6 years. I work in a group business so someone else pays the bills, mortgage etc and I take a percentage of what I earn.
so, I have found a premises and we've said yes to the contract etc. I have some money from family but ideally want my own money from a bank. Does anyone know anywhere that would even entertain a self-employed person with only one yr books? I have a business plan etc all ready but so far, no-one will even entertain the idea.
Thanks

Fiddlestick

becw wrote: »

Hi
I've been self employed for 1 year and before this I was a student for 6 years. I work in a group business so someone else pays the bills, mortgage etc and I take a percentage of what I earn.
so, I have found a premises and we've said yes to the contract etc. I have some money from family but ideally want my own money from a bank. Does anyone know anywhere that would even entertain a self-employed person with only one yr books? I have a business plan etc all ready but so far, no-one will even entertain the idea.
Thanks

Who is "no-one" and who have you asked for finance?

Have you approached your own bank with your business plan?

If the business plan is solid and shows promise, your bank would probably be good to approach.

How much are you looking to borrow?

becw_2

asked bank and they don't want to know as we don't have 2 years banking from our jobs as we were students not earning before this, would like to borrow 20k

CLAPTON

a little confusing...

you already have the 20k but it's from family?

you use 'I' and 'we' interchangeably but they mean different things

how much was your profit last year

Thrugelmir

I work in a group business so someone else pays the bills, mortgage etc and I take a percentage of what I earn.

Are you truly self employed?

What is a "group business"?

Why do only take a % of what you earn? What happends to the rest of the money?

Tixy

Have you spoken to an accountant /business advisor? have they looked at your business plan to see whether they will help you apply to banks for funding (they may also be able to suggest alternative sources of funding.
Are you wanting to put in £20k from family and borrow £20k rom a bank as well? What is the money going to be used for? is it anything that the bank can secure the debt on?
I assume you are not in a position to offer personal guarantees on the loan?
Is your business set up as partnership or limited company?

Is this the same line of business as you have been in for the last year? do you have your accounts prepared for the first year? do they show you made a profit?

becw_2

Ok i seem to have confused some people for some reason!!!
I work for a company on a self employed basis but I only take 45% of my earnings. The boss takes the rest. I don't have any money from family. I want to borrow 20k from somewhere. The bank have turned me down as I have only been SE for 12 months and before this I was a student on a 6 year degree so have no history of any wages apart from summer work which obviously doesn't count.

HappyMJ

If you are working for a limited company you will be employed. You might consider yourself to be self employed but you are technically employed. By saying you have a boss this points to employment rather than self employment. If you had said "I work for a company and take a 45% commision and the client retains 55% of sales that I generate" then that is self employment.

The company (no matter how small) must still run a payroll and will have a record of pay, income tax deducted and national insurance contributions made. They should be paying you a small salary then the remainder is paid to you as dividends which will also be recorded for corporation tax purposes.

To borrow money to invest into a company you will need an asset to secure the loan. i.e your house.

Tixy

If you are registered as self-employed and only work for one company then you and them need to be very careful about whether you should really be classed as employed.
There are specific rules to consider but as MJ says if you are calling someone your boss and only work for them it does sound like you could actually be considered to be employed by HMRC. When the company you do work for next has a visit from HMRC they may look into this and there would potentially be a fine to pay as well as national insurance etc.

Aside from that what do you want to use the £20k for?
Have you seen your accountant with your business plan? If they believe it is a viable business they may well be able to suggest alternative ways to help you get a loan aside from the high street banks.