Did you know there are over 2 million freelancers in the UK alone? From graphic designers to writers, web developers to translators, freelancing is a booming market that continues to grow.
If you’re a freelancer, you’ll appreciate the autonomy it gives you versus a regular job. But when it comes to your finances, should you go it alone, or seek the advice of an expert?
I personally employed an accountant as soon as I started my business. Wanting that expertise and separation of responsibility from myself.
Here are our thoughts on is it worth finding an accountant online if you’re a freelancer to tell you more.
Self assessments are like a welcome party to your new freelance life. Only, they are incredibly dull and you have to pay money at the end if you earn more than your personal allowance. Ok, so maybe they aren’t so fun after all. Especially as your self assessment is compulsory and you need to fill it in correctly and submit it on time. D’oh!
Not everyone is great with numbers, nor do they understand all the savings they could possibly make on their tax return either. With so much time spent tending to your clients, it’s easy to let your self assessment slip. Who are you going to call? Tax busters – in the form of an accountant, that is. They will be able to make sure you are paying exactly what you owe, keeping HMRC firmly off your back. We can’t promise the same for your clients though…sorry!
If you don’t use a freelance platform that does it for you, you’ll need to produce your own invoices. Contrary to popular belief, an invoice isn’t a scrap of paper with a figure written on it. What you actually need to provide is the likes of a unique reference number, your company name and address, a clear description of what you are charging for and the VAT amount if applicable.
Keeping on top of your invoicing is imperative, otherwise, your cash flow could suffer. Plus, it will help you when it comes to your self assessment too, as everything will be easier to trace back. An accountant can help create an invoice for you, or you can even outsource your invoicing entirely to them. That leaves you free to focus on your work, rather than billing your clients.
Cash Flow Forecasting
Every business needs to maintain a steady cash flow in order to survive. Depending on the nature of your business, you may have some months that cover slower months. For example, a wedding singer may earn the majority of their earnings during the summer months, when more bookings are more likely. They would need those earnings to see them through the winter too.
An accountant can help put together a cash flow cast for your freelance endeavours. This can show up any dips in income, giving you a better chance to prepare. It’s also an excellent way to track your progress to ensure you can continue as a freelancer with what you are currently earning.
To Sum Up
It’s pretty safe to say that regardless of what you do as a freelancer, everyone needs some guidance. By making sure your financials add up, this will make your business a lot more secure especially as we navigate economic uncertainty in the months ahead.
By getting an accountant on your side, your freelance business is best placed to survive. From self assessments to helping you plan for the future, they are incredibly valuable professionals to have on board.