Viewing 37 posts - 1 through 37 (of 37 total)
  • Going self employed after corporate life
  • Bushwacked
    Free Member

    After some thoughts. After spending all my working life so far (22 years) working for corporate companies. I’m considering a massive change and going self employed.

    Obviously loads of risk as it’s in a totally different field but I’m quite excited about the change.

    However there are a few worries, namely income and making sure I have everything covered.

    Anyone done similar and can share their experiences?

    alexpalacefan
    Full Member

    [video]https://www.youtube.com/watch?v=co_DNpTMKXk[/video]

    Some good advice here.

    APF

    Stoner
    Free Member

    Went freelance after 8yrs corporate, have been so for the last 10yrs. Best thing I ever did.

    Not really a change of field for me, more an opportunity to gouge a deep and lucrative niche from my specialism. And not really in the realm of “run your own business” levels of stress and business building. I rarely need to develop new clients myself (new clients come by word of mouth or through JVs) and nor do I have to burn the midnight oil desperately trying to keep my “business” afloat. So I get the utter pleasure of working part time (c.20hrs a week) for a substantial annual income, and it gives me all the time I need/want to spend with my boys, on projects, hobbies, house-keeping.

    And never need I answer to some over-promoted dick somewhere up the corporate tree.

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    deadkenny
    Free Member

    Self employed as freelance / contractor? If so, hold on until the Autumn Statement on the 25th to see if the rumoured ‘one month’ rule comes in. If it does, this can affect how you set up your business. Basically the proposal is that if you work for a single client for more than one month you will be forced to go onto their payroll. Insane!

    jekkyl
    Full Member

    having to sort out your own tax, no sick pay, no holiday pay, no pension contributions, no chatting to busty Amy from complaints at the drinks machine. Yay self employed.

    Bushwacked
    Free Member

    I’ve not met Amy. Yet.

    kcal
    Full Member

    I think after 22 years – something like that – I was made redundant and forced to work out what I wanted to do. Tried some part-time employed work, but at the same time I went freelance, and that was much better.

    Haven’t regretted it much. Some downsides are less social interaction, as above no sick pay, no holiday pay, my accounts are simple so can do my tax and VAT myself.. The freedom and flexibility work out great for me – able to fit around home life – while back there was a lot of child stuff needing done, that was no problem, bit less of that now but now have an elderly parent that needs checking up on – again, can fit that around working day/week..

    Bushwacked
    Free Member

    So the situation is I’ve been in sales for a financial services company for sometime as a salesman, consultant and a team manager. Quite a specialist area and home based covering the whole of the UK, loads of pressure but not much reward. I’m looking for a new job anyway as I’m disillusioned with the company and their values.

    How I look at it is currently I’m time poor (working mostly 10-12 hour days) and due to various factors – mostly paying debt off from a previous failed business attempt by my wife – I’m disposable income poor too and have been for a number of years.

    However financially things have turned a corner, my wife has started a business (dog walking) which is growing rapidly and our levels of debts have reduced massively to a point where at a stretch we could make it work financially.

    My thoughts are we work well together and even if I jump in and do it for 12 months it’ll be a great break to try something different. If it works out great, if not I’ll just dive back into a proper job. Also, there is a chance of doing some consulting here and there to top up my wages.

    Also, I’ve got two kids school age and I’m realising they are getting older and spending time with them is important.

    badnewz
    Free Member

    I’ve been self employed for a few years now. I prefer it as I knew I wasn’t built to succeed in a corporate environment, as I like working on my own and have a very low tolerance for politics.
    But the main reason it works for me is the fact that I’m single with no kids, so I can afford the variability of income just by cutting back on expenses when things are slow. I imagine that is a lot harder to do with dependents as they are to a certain extent “a fixed cost”.
    Sorting out things like tax is easily done just by employing a decent accountant. In terms of social interaction, there are plenty of networking events you can attend, and IMO the pretty girls working in coffee shops make up for not being able to chat with Amy at the water cooler.
    People like Stoner above with a very niche expertise tend to make as much if not more money being self employed, but I think the stats are that people who are self-employed generally make less money overall.

    Bushwacked
    Free Member

    Badnewz – I don’t think I’m built for corporate life either, although I’ve done well so far. I just can’t be arsed with the politics and bullshit. I can see loads of opportunities and problems with the business but the crap internally makes it impossible to achieve/improve anything. People seem to be in-love with the company rather than their customers and the customers suffer while the business slowly dies. Sounds dramatic but had 2.5 years of frustration and got to the point of too many bruises from banging my head against the wall.

    In terms of costs, I am actually excited about the adventure of learning to live on less money and teaching the kids to survive with what you have. It’ll be tough but some of the best memories and experience are drawn from challenge.

    I suppose my worry is what have I not considered, such as some hidden costs, tax burdens and the impact of not having credit readily available.

    windyg
    Free Member

    I spent 25 years doing pretty much the same job just for different employers, got bored so decided to do something different and set myself up as a garden services company.
    It’s an adventure for sure & so far all gone well, I make the same as I did employed but have the flexibility of my hours/days.

    There is a lot of free help out there too, I have had contact with a business advisory service who have given me so good pointers, even HMRC have some good advice regarding self employment.

    Hardest part for me is getting known but that is growing now as customers are now recommending me and search engines are working getting the commercial work.
    Don’t be shy tell everybody what you do and get everybody else to do the same for you sometimes you have to be a little be cocky with it.

    The tax side of things isn’t that hard really just a case of keeping good records of income and outgoings, my wife was self employed so I do have help there

    What line of work are you looking to get into?

    Bushwacked
    Free Member

    Good to hear.

    It’s dog walking – massive change but I love the outdoors and dogs. My wife is doing well since she started two years ago but she only has a certain reach geographically and is turning away work as she can’t cover it. So I’m going to step in to do the bits she can’t do and help to expand. We think we can cover the bills.

    The best thing is she already has her name known locally, although this could be improved on as most of the work is coming through word of mouth.

    Hadn’t thought of the free advice we might be able to get so will look into it.

    brooess
    Free Member

    Get talking to an accountant who specialises in self-employment/limited companies and make sure you understand all the ins and out re additional costs.
    e.g. you may have to pay accountants fees, possibly VAT and possibly indemnity insurance.

    Otherwise, good luck. I’m going back perm after 4 years as a contractor. I much preferred it, it frees you up from a lot of nonsense and allows you to get on with the work. It’s especially good if you’re not built for corporate, you get a much better sense of what you can achieve when your environment suits you.
    The only reason I’m going back though is I can’t find another contract for love nor money, after 4 months of looking… so make sure you factor in extended periods of low or zero income if the work dries up, especially as UK economy is still very sickly and another recession is very possibly around the corner (manufacturing is already in recession)

    Bushwacked
    Free Member

    Yeah, the thought of the finances not going as planned, and we’ve been conservative, is a worry

    Alex
    Full Member

    4 years for me. Before that I worked for small, medium and very large firms and ran a 15 person consultancy for about five years. Would NEVER go back to running a company – too much stress. Would really rather not ever go back to being employed but as brooees says sometimes the contract market dries up. Your situation sounds different as you already have something to go too.

    I’ve been really lucky because in HE everyone knows everyone so I keep getting calls from Uni’s asking for help. It means I have lots of clients so it never gets boring and if one runs out of cash, hopefully the other ones won’t at the same time! Dunno if it’s HE (and it might change after spending review), but I’ve never to turn so much work down as I have this last 3 months.

    It’s so much better than contracting (regardless of if the one month law comes in) working for a few different people. When I’m not on site, I get paid to produce stuff, so if I want to ride my bike in the day and work at night that’s fine. I’d really, REALLY miss that flexibility.

    Financially it’s been good. But it’s not about the money. I’m pretty much unemployable now.

    deadkenny
    Free Member

    It’s all about doing all you can to bring money into the business and building up a fund to pay yourself for a decent period of time even if business is low.

    Okay my background is contracting, but I see many just extract all the money each month and spend it all, with nothing spare. Then when contracts dry up they’re forced back to permanent to make ends meet.

    Think about the business, not just an income.

    Bushwacked
    Free Member

    Alex – I agree on it not being about the money.

    I used to want to work to get credit, buy a house, have some holidays and do stuff. But now I’ve got kids, a great wife, we have a house we’ll be in for a long while and we’re tied down by the kids and their education. It’s become about actually making the most of the kids, stuff and life generally. One frustration I have is as I’m away 2-3 nights a week I haven’t much of a social life and it’s something I want to change.

    Plus money has become secondary as following paying back the money from my wife’s first business we’ve learnt to live and enjoy things without the big holidays or spending cash on stuff we don’t need (except bike related items of course).

    I’m getting really excited about it now…

    However, I’m going to hold on for a few more months to get everything set in motion to make the transition as successful as possible. One key aim is to get some savings in place as running capital for the first 6-12 months.

    project
    Free Member

    Readin Lord Alan Sugarsbok, he got asked one simple question when he gave up a paid job to work for himself.

    Alan whos going to pay you on Friday night, work that one out and your almost there.

    self employed since 1990, thats me

    TheBrick
    Free Member

    Self employed as freelance / contractor? If so, hold on until the Autumn Statement on the 25th to see if the rumoured ‘one month’ rule comes in. If it does, this can affect how you set up your business. Basically the proposal is that if you work for a single client for more than one month you will be forced to go onto their payroll. Insane!

    That is mad! The number of one man bands that would hit would be mad.

    kcal
    Full Member

    it’s crazy — would def. affect me and to be honest I’m not sure my client would take me on the payroll.

    Result – probably – less tax revenue for the HMRC and I’d be in sh!t. Highly experienced developer jobs in rural backwater – um…

    footflaps
    Full Member

    There has been so much abuse of/by the self employed over the years though, basically opting out of PAYE and paying in dividends yet still really working full time for a company.

    maccruiskeen
    Full Member

    due to various factors – mostly paying debt off from a previous failed business attempt by my wife – I’m disposable income poor too and have been for a number of years.

    One thing you’ll not appreciate being self employed is debt or any other regular outgoings – its not that you’ll earn less (or more) necessarily but income tends to come in irregular sizes and intervals so what you don’t appreciate is money going out regularly. I had a miserably first couple of years transistioning from salaried work to self employed trying to ween myself off direct debits. Now the first thing I do when theres cash in the bank is pay up any upcoming costs – council tax – pay it all up front, utilities paid quarterly rather than monthly dd, cars / vans all bought on cash rather than credit and so on. It can be a difficult transition precisely because you’ve got regular DDs so when the time comes to re-insure your car or something then you’ll not necessarily have the cash to break the cycle.

    What you want to work towards is the ability to tighten your belt if theres a lean spell or an late payment (or for me because work come in 2-3 month chunks that don’t get paid til completion) and just do nothing and spend nothing – and thats difficult if your bank account will just empty itself anyway.

    There has been so much abuse of/by the self employed over the years though, basically opting out of PAYE and paying in dividends yet still really working full time for a company.

    There certainly has been but I’d be pretty certain there must be a middle ground between ‘companies’ with only one customer for years on end and a company engaging with a client for more than one month at a time. Your shed took more than a month to build – would you be expected to take on the bricky as your salaried employee?

    brooess
    Free Member

    There has been so much abuse of/by the self employed over the years though, basically opting out of PAYE and paying in dividends yet still really working full time for a company.

    It sometimes works better for the company though – the ability to lay people off at zero cost and with no notice. I suspect Osbourne is after the tax though. He may not have his numbers right though – my day rate was such that now I’m going back perm my overall annual tax contribution will be lower than it was as a contractor – he may well be shooting himself in the foot here, as well as increasing the number of unemployed, not least because companies may have to lay people off to cope with the increased costs of a larger perm workforce…

    TheBrick
    Free Member

    Not to mention no pension contributions holiday pay etc.

    myti
    Free Member

    Rather than just dog walking which is fairly limited on income what about a doggie day care? If you can get premises and there is demand in your area. It seems to me a way to make it more of a business rather than just being a self employed dog walker. Could even sell products to your customers when they come to collect their pampered pets such as treats, toys etc. Could sell extras like grooming. If there is a dog walking forum get on there and get researching. I’ve been self employed for 10 years but a year ago I joined an industry forum which opened my eyes and I’ve now moved from just being self employed to feeling like I actually run a small business with much better earning potential.

    footflaps
    Full Member

    The simplest solution would be to just up dividend tax to something sensible like 30% and then the advantage of going Ltd vs being employed would almost vanish.

    kcal
    Full Member

    well that’s assuming that all dividends paid out are from PSCs / tax avoiding self-employed.

    which isn’t the case 🙂
    That would royally screw many folks’ savings plans, ISAs, pensions and so on..

    footflaps
    Full Member

    That would royally screw many folks’ savings plans, ISAs, pensions and so on..

    Dividends in ISAs aren’t taxed. Pensions are taxed at a lower rate (were untaxed until Gordon Brown changed the law).

    kcal
    Full Member

    You mean the tax credit that is auto deducted in an ISA that can’t be claimed back?
    Tax credits deducted in a SIPP as well. It’s just that – roughly – they’re a bit more sheltered than bare portfolio dividends.

    Bushwacked
    Free Member

    Myti – all over that already. We do day, n8ght, weekend and holidat boarding already.along with training for difficult dogs and pack socialisation for dogs which don’t normally like Packs. We are also focusing on breed specific walks too

    RaveyDavey
    Free Member

    Ha ha APF nailed it in the 2nd post. You all know it.

    DezB
    Free Member

    Hey Bushwacked – really interesting to hear your choice of the line of work you want to move into. I have considered this, thinking ‘Hey, i love dogs! I love the outdoors!’ Perfect. But! I’ve done a couple of jobs now and my lord am I finding it BORING!! 😆 Used to using my brain at work and I think I really need to go back to doing that. I guess you have helped out your wife on occasion so are aware what you’re getting into but it hasn’t taken me long to decide there is no way I could do this for a living.

    deadkenny
    Free Member

    ootflaps – Member
    The simplest solution would be to just up dividend tax to something sensible like 30% and then the advantage of going Ltd vs being employed would almost vanish.

    Low NI, reduction of corporation tax through expenses, benefits of company paying pension contributions entirely instead of employee, amongst other little things.

    But aside from the money aspect, a Ltd company provides protection in business so the company can be held financially liable, but not yourself as an individual. To a degree. In fact I’ve had clients that refuse to work with an individual, only a ltd company.

    There’s been some push to introduce a Freelancer Company, but it seems all efforts to work with HMRC to provide a workable freelance solution have been ignored.

    None of this seems to be relevant to the OP anyway as he’s talking about a dog walking business which will involved multiple customers and is a legitimate business to HMRC.

    My only hesitation about it is my dislike for the loads of vans turning up at forests full of dozens of dogs and a “professional” dog walker who gets out looking fed up and lets the dogs just bugger off shitting everywhere and not bothering to pick up the crap 😛

    Bushwacked
    Free Member

    Tell me about it, the dogs enjoymwnt of the experience has got to come first but the rule of take what you brung has to apply. Training the dogs to picnk their shit up will be interesting

    Bushwacked
    Free Member

    Dezb – I’ve done it a number of time and live it. I see it as a break fron the shite I’m doing now and a bit of punctuation in life. Not sure how it will turn out but saying that my wife of 21 years was supposed to be a one night stand 🙂

    glasgowdan
    Free Member

    I started my grounds maintenance business a couple of weeks after finishing up with a corp. First year saw me feel a lot of anxiety even though there was cash coming in. Since then it’s been easy going, better cash and full independance. I’ll never work for someone again.

    This year I’ve gone down to a 20-24hr week, still make a full wage and have 3 full days a week with my wee boy.

    badnewz
    Free Member

    I find out this week what’s happening with the contract from my main client…I have to admit I’ve been eyeing up full time corporate jobs in the meantime, but my preference is to stay self employed, even if it means earning less and no pension contributions.
    There is another way also to look at the “uncertainty of income” situation from being self employed. That is, most corporates are always going through waves of redundancies anyway, so there is an increasing amount of uncertainty now with full time corporate jobs. So I guess the difference is getting smaller over time.
    I think in 20 years time the majority of work in the UK will be done by freelancers.

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