rates to charge, tax, NI etc if going self employed..?

brightonman123

I have been working as an employee (office / accounts admin, non qualified) most of my life, though currently out of work..

Was thinking instead of looking for ONE firm to work for, I could maybe offer my services (steady!), to firms, on a daily / weekly basis..

but I have no idea what a worthwhile rate would be to charge, and also what approx %age of this would need to be put aside, for tax, NI, and maybe VAT even?

Most likely aiming at SME or sole traders, letting them use their staff/resources to build business, rather than waste time chasing unpaid debts etc..(that would be where i come in,, i can do excel, and hard calls, me!)

what expenses could be allowed, if travelling to each place? (bus/train fares, etc)

many thanks..

brightonman123

after thought- was thinking I would need firms to confirm payment each day / week, before i give them an action plan (aka fancy spreadsheet!), highlighting any dodgy accountsm projected cashflow each week etc..

BACS or paypal?

Savvy_Sue

brightonman123 wrote: »

but I have no idea what a worthwhile rate would be to charge, and also what approx %age of this would need to be put aside, for tax, NI, and maybe VAT even?

Working backwards, you're unlikely initially to have to be registered for VAT, but some companies may not be used to dealing with non VAT reg cos so it can be to your advantage to register voluntarily.

Tax and NI: I'd always put aside at least 25%, but take a look at the HMRC website as it's class 2 NI flat rate and class 4 based on % of profit.

As for your hourly rate, it needs to be more than you'd expect to be paid as an employee, because you won't get paid holidays, you won't get any sick pay, you'll probably have to pay at least something for advertising and marketing to get yourself known etc. And you won't get paid any hours you're not actually working.

brightonman123 wrote: »

Most likely aiming at SME or sole traders, letting them use their staff/resources to build business, rather than waste time chasing unpaid debts etc..(that would be where i come in,, i can do excel, and hard calls, me!)

However, you have to bear in mind that each time you go into a company, they need to get you up to speed, so they'll need to use their staff / resources to do that. AND when you do your hard calls, again bear in mind that the person at the other company may spin you a line about how they thought this was all sorted out with Fred, so they're surprised that now you're calling, and then you'll have to go and get Fred to confirm whether or not it's a load of old flannel etc.

brightonman123 wrote: »

what expenses could be allowed, if travelling to each place? (bus/train fares, etc)

You can claim reasonable expenses incurred in the course of your business, I believe.

brightonman123 wrote: »

after thought- was thinking I would need firms to confirm payment each day / week, before i give them an action plan (aka fancy spreadsheet!), highlighting any dodgy accountsm projected cashflow each week etc..

good luck with that: turn it around and ask why would I pay you before I've seen evidence of what you've done? Plus there could / should be some kind of authorisation system: a colleague and I can submit bank payments, but only after a manager has confirmed the payment's due to be made. That can take a day or two. So allow a week for you to be paid, and your report could already be out of date.

I'd have terms and conditions agreeing what I'm going to leave at the end of each visit, and agreements for how frequently and how fast you're going to be paid. I'd also be crystal clear about how their payments systems work. For example if you work for an agency they'll require you to get your timesheet in by a certain time each week, and they'll require that timesheet to be signed by someone at the company where you're actually working. Those are your responsibility: you do that and they'll pay you on time.

Working independently each company may have a different system. We'd expect you to submit an invoice: if you get it in to us in time for us to get it signed off by a manager before Friday we'll pay it on Monday, but if it doesn't reach us until Monday you'll probably wait a week.

brightonman123 wrote: »

BACS or paypal?

If you want to be taken seriously, BACS. Our bank is now doing faster payments, so you should get it the working day after it's sent.

Notmyrealname

Savvy_Sue wrote: »

Working independently each company may have a different system. We'd expect you to submit an invoice: if you get it in to us in time for us to get it signed off by a manager before Friday we'll pay it on Monday, but if it doesn't reach us until Monday you'll probably wait a week.

If you want to be taken seriously, BACS. Our bank is now doing faster payments, so you should get it the working day after it's sent.

Wow, you're quick. Some of my clients were on 60 days with monthly invoicing. Not a problem if you know in advance and can plan for it but for someone unaware, it can be a hell of a shock. Of course once the first is paid then you get one every month after that and three after you finish for them but the first 3 months can be challenging.

Savvy_Sue

Notmyrealname wrote: »

Wow, you're quick. Some of my clients were on 60 days with monthly invoicing. Not a problem if you know in advance and can plan for it but for someone unaware, it can be a hell of a shock. Of course once the first is paid then you get one every month after that and three after you finish for them but the first 3 months can be challenging.

Agreed, we're quick: but then we're small and friendly, not paying hundreds of invoices each week. At one point we'd log in and make payments daily, but now we do it weekly which is much more efficient.

But we agree the OP cannot expect to be paid before providing results of their work, do we not? And it may then be a long wait, and you MUST establish what the wait will be before you start.