Becoming a SI domestic cleaner -help please

Dontknowanymore

Hi all
I had to register as self empolyed last year to become a chat line operator, basically the company who forwards on calls to me, pay me the money I earn and I am liable to sort out my tax and NI, so I didn't go in to self employment to specifically run a business. I'm still doing this but it's just not really financially viable.

Anyway, to cut a long story short I have decided to start at domestic cleaning. I have 2 people who want me to start already.

Now what I would like to know,firstly, what type of insurance should I take out.
Also, is it best to draw up contracts between myself and my clients?
As I will mainly be dealing in cash, do I need to bank every bit of cash I get?

Is there anything else I should consider?

I am going to contact businesslink but thought I would ask on here first too.

paddyrg

Insurance I'd say you'll need at least public liability in case you injure anyone. Next step up could be some kind of indemnity if you damage anything, but ou could also look at addressing that in your terms of business.

Which means yes, absolutely, a contract is vital. People are often afraid of contracts, butt that is because they are misused to scare people quite often. A contract is an agreement for an exchange, you make it when everything is setting out, so if there is a problem both parties have already agreed a remedy. Let's say you were cleaning a sofa but instead of real leather, it was some kind of fake leather which spoiled with your leather polish. If you had an upfront agreement that you would be working on a best efforts basis, but would not take responsibility for damage where the homeowner hadn't specifically advised you of a potential problem (special cleaning stuff for the sofa), then you can both refer to the contract, say "ok we agreed upfront that this wasn't your fault" and move on. Without that in a contract, the homeowner might try to sue you for a new sofa (and reading these boards, the world is full of such people) - whether or not they stand a chance, it would be massively stressful. A contract is about negotiating in peace what you fall back on in war.

Should you declare all your income? Absolutely. It is a legal requirement. Extreme case, but Al Capone the 1930's gangster who ran drugs, alcohol, prostitution and gambling rackets (all illegal) was finally busted for tax evasion. They couldn't get him on those activities, but got him on the tax. Tax is how the government pays for hospitals, schools and defence of the realm, so they take its collection seriously. And rightly so.

easyhost

Dontknowanymore wrote: »

Hi all
I had to register as self empolyed last year to become a chat line operator, basically the company who forwards on calls to me, pay me the money I earn and I am liable to sort out my tax and NI, so I didn't go in to self employment to specifically run a business. I'm still doing this but it's just not really financially viable.

Anyway, to cut a long story short I have decided to start at domestic cleaning. I have 2 people who want me to start already.

Now what I would like to know,firstly, what type of insurance should I take out.
Also, is it best to draw up contracts between myself and my clients?
As I will mainly be dealing in cash, do I need to bank every bit of cash I get?

Is there anything else I should consider?

I am going to contact businesslink but thought I would ask on here first too.

well you will need business insurance. most will cover

Public liability insurance – covers claims arising from your liability for injury to a person outside of your employment or damage to their property.
Employers’ liability insurance – a legal requirement if you have 1 or more employees, this cover insures for claims arising from your liability for employee illness, injury or death.

as these are legal requirements, but you will also need

Professional indemnity insurance – covers claims arising from your negligence or bad advice in work you have done for a client.

also insurance to cover any equipment you use (vacuums etc.) also if you use your own car then you will need to inform your insurance company that you are using this for business purposes.

HappyMJ

Dontknowanymore wrote: »

Now what I would like to know,firstly, what type of insurance should I take out. What's the chances of ever claiming? If you are cleaning very expensive houses with potential damage to an expensive floor or surface then yes public liability but i wouldn't bother the claims typically would be too small.
Also, is it best to draw up contracts between myself and my clients? It's best but not necessary.
As I will mainly be dealing in cash, do I need to bank every bit of cash I get? No, you can spend cash on yourself.

Is there anything else I should consider?

I am going to contact businesslink but thought I would ask on here first too.

Business link would be best. If you insure every eventuality you'd have no money left so it's a matter of risk/return. One thing...if you use your car to drive to the clients site you should make the insurer aware of it. They may or may not change the premium. It won't be much.

Dontknowanymore

Thank you for everyone replies.

Firstly when I said do I bank all moneys given, I didn't mean it in the sense of doing a few jobs off the books, I meant, does there need to be proof of the money I am given if that makes sense.
So basicallyI will be giving receipts and doing invoices, so do I need to have a bank account which matches the exact money I have been given and that i recorded in my books?

I already have put on my list about my car insurance, will sort that out over the weekend.
I will definately give business link a good read!
Gosh this is all rather daunting, but I need to earn a living for me and my children so I am fully prepared to put in the hard graft, I have also jus seen a friend who has just started a cake making business, she is going to show me how she does her books etc.

pipscot

Dontknowanymore wrote: »

Thank you for everyone replies.

Firstly when I said do I bank all moneys given, I didn't mean it in the sense of doing a few jobs off the books, I meant, does there need to be proof of the money I am given if that makes sense.
So basicallyI will be giving receipts and doing invoices, so do I need to have a bank account which matches the exact money I have been given and that i recorded in my books?

I already have put on my list about my car insurance, will sort that out over the weekend.
I will definately give business link a good read!
Gosh this is all rather daunting, but I need to earn a living for me and my children so I am fully prepared to put in the hard graft, I have also jus seen a friend who has just started a cake making business, she is going to show me how she does her books etc.

I would bank all the money received and then use the bank for payments (i.e. don't buy cleaning materials from the cash you received, bank it, then buy your materials).

A separate bank account for all your business income and expenditure will also help you to keep a good track of your business. You could start off with a personal bank account but if you start paying in lots of cash, the bank may ask you to open a business acount.

Mojisola

Dontknowanymore wrote: »

Also, is it best to draw up contracts between myself and my clients?

Drawing from my experience of sorting out cleaners for my parents, I would always prefer a short contract. Put in writing how much it's going to cost and whether you want any weeks notice of cancellation. Decide what's going to happen when you're on holiday and when they're on holiday.

I also prefer when there is an initial visit to go round the house, looking at what needs to be done in each room. Make a record of the agreed tasks and give the client a copy. That will protect you from "job creep" where the client keeps asking you to do extra things and you can use it as a review to make sure you're not letting anything slip.

Dontknowanymore

pipscot wrote: »

I would bank all the money received and then use the bank for payments (i.e. don't buy cleaning materials from the cash you received, bank it, then buy your materials).

A separate bank account for all your business income and expenditure will also help you to keep a good track of your business. You could start off with a personal bank account but if you start paying in lots of cash, the bank may ask you to open a business acount.

Thanks, I use my old personal account with my previous bank which my chat line money gets paid in to, although I don't use it for day to day things.
Would it be best to pay for petrol from the account or does it not matter as long as I keep the receipts for the petrol and record how many miles I travel?

Mojisola wrote: »

Drawing from my experience of sorting out cleaners for my parents, I would always prefer a short contract. Put in writing how much it's going to cost and whether you want any weeks notice of cancellation. Decide what's going to happen when you're on holiday and when they're on holiday.

I also prefer when there is an initial visit to go round the house, looking at what needs to be done in each room. Make a record of the agreed tasks and give the client a copy. That will protect you from "job creep" where the client keeps asking you to do extra things and you can use it as a review to make sure you're not letting anything slip.

Thank you for that useful advice.

paddyrg

Some sage advice here Putting everything through the bank is easiest in many ways as you can instantly see your income and outgoings and that's going to make your bookkeeping much easier. But you certainly can keep 'petty cash' - but make sure you still account it (ie record where the cash comes from, and keep receipts when you spend the petty cash). It can be helpful to have a plastic envelope to keep the cash and receipts in all together, then sort it all out once every week/month/quarter.

pipscot

Dontknowanymore wrote: »

Thanks, I use my old personal account with my previous bank which my chat line money gets paid in to, although I don't use it for day to day things.
Would it be best to pay for petrol from the account or does it not matter as long as I keep the receipts for the petrol and record how many miles I travel?


Thank you for that useful advice.

I would tend to use the 1 bank account for all business expenditure to keep things simpler but as long as you keep your receipts it's not a massive problem to have paid for things from other accounts. It's really only when businesses get bigger that things get more complex. As you are starting off, you just need to keep track of your turnover (paid into your bank account) and your expenses (keep receipts/proof).

"Cash in hand" businesses are often a target for investigation which is why I suggest that you bank all your takings. You just need to make sure you keep records so you can prove your income - you've mentioned giving receipts to clients - that's exactly the right thing to do

Good luck with your venture.

paulofessex

Also business bank account charges for depositing cash can be very high compared to other methods i.e. Chq's or Bank Transfer, therefore it may pay you too see your customers could pay by other methods rather than cash as the business grows.