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May 2018
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There is an increasing number of people who are turning the back towards employment and sorting to engage in self-employment. Freelancing is one of the “work at home” jobs that most people are turning to. For you to succeed as a freelancer, you need to be disciplined, have the right marketing skills, and be a master of your own strengths. There are also the legal and tax requirements that every freelancer should adhere to. Starting as a freelancer is not easy as you will be subjected to more responsibilities. Decisions you make, determine the tax benefits you attest. The following are the steps that need to be developed when starting as a freelancer. Type of Business You can choose to either start as a sole trader, a partnership or a limited company. Each one of these has its own pros and cons.
Compliance with Legal Requirements Decide on the type of business you want to set up. Select a name that you will use in the registration. The law requires that the name selected should be one that is not being used by any other business. Searching on a business name can be done in in the companies to ensure that your name is not registered. After selecting the name, you are required to register your business for assessment. To register a limited company, submit your memorandum of association and article of association in the Company house. Also, submit your application and wait for your company to be registered. Limited companies need to register for PAYE and corporate taxes. Before you start trading, you need to have business insurance and open a bank account. Accounting for the Business Whether your business is a partnership, sole trader or a limited company, you need to assess your tax returns yearly. Most companies employ accountants to help them with the task. Small businesses that cannot afford to hire an accountant can use the services of an umbrella company. The business owners should ensure that they keep a record of all the business transactions. This can be used to track the progress of the company. Any freelancer should also be in contact with the PAYE registration helpline to advise them accordingly on business taxes. Trade Description
Many new freelancers think it is okay to put anything on their websites as part of the advertisement. False branding might lead to the closure of the business as it is against the law. You are required to register their activities with your real names. Written Agreements Written agreements among the shareholders and partners are required. Clarification of the roles of every partner should be clearly stated as well as the contracts between shareholders or partners. Protection of Intellectual Property A business must protect its innovations regarding patents, trademarks, and copyrights. Intellectual property offers an industry an opportunity to shut down its competitors hence maximization of profits. Copyrights provide the exclusive right to use original work like books, photos, and software. You should do a lot of research before trying to determine the type of business you want to start. This will help you to be ready for the challenges that might come during the setup. You should also know the legal requirements of each type of business.
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