For those who are remembering to check the blog regularly, here's a freebe toward your research for professional practise. A few bits of information on starting up as freelance and good practise toward having a stress free time come tax-return time! (figures quoted below correct for 2011-12)
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So you've completed your course and through your blogging and tweets you've got a few people interested in paying you for some freelance illustration or animation work, the jobs are straightforward and the money sounds good... but have you considered what your working status is now?
Freelance, Independent artist, Creative consultant - just a few of the catch-all names people use in the industry to describe working for themselves. Being self employed is a bit different to working for a business as an employee, and it's important to know early on or ahead of time exactly what your responsibilities are with things like record keeping, tax and working life.
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First you'll need to regester as self employed and get your Unique Taxpayer Number (if you have a student loan, they'll want to know this number too so they can take repayments from your self employed profits). Just ring the HMRC newly self employed hotline:
0845 915 4515
Do you want to operate under your own name?
e.g. Paul Summers independent illustrator
Or are you planning on having a business name?
e.g. Sunshine Illustration
If you have a business name other than your own, you need to make sure all your business stationary (letters, invoices, cards, emails etc.) clearly include BOTH your name and your business' name.
Also make sure your chosen business name isn't already in use! (see links below for a name checker)
You'll need to start paying Class 2 contributions for National Insurance (£2.50 a week) and if you earn £7225 or more per year from your work you'll need to pay Class 4 contributions also (a % of your higher profits). Though if you earn less than £5,315 you can CHOOSE to get exemption from paying Class 2, but be aware that if you do choose not to pay them you won't then recieve credit for National Insurence payments for that period, which can affect your access to certain pension and other govenment service related benifits later down the line.
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Once you are up and running you'll want to keep reasonably detailed records of the movement of money in and out of the business.
It's worth building yourself a spreadsheet or buying a finance ledger where you can note down income and business expences - Note that if you are working from home, you can alocate a PROPORTION of certain building costs RELEVENT to the business - electricity, telephone landline/mobile, internet, councel tax, home insurance, rent etc. (the proportion is based on number of rooms in the home and amount of time spent on business use of the costs being clamed for - see HMRC guidence for more info)
Also set up an invoice template with your name, your business name (if you have one), date, person or business being invoiced, description of the work you have done, cost you are charging and instructions on how to pay you. Make sure you invoice promptly, it encorages clients to pay up while it's fresh in their mind and don't be scared to follow up on unpaid invoices if they are taking an unreasonable amount of time to pay. Consider agreeing before you start a project that half the money will be payed once you are part way through the project - this keeps your cash flow more stable and protects you against slow paying clients.
Business related travel costs and learning can also be accounted for (see HMRC guidence for more info)
And remember you need to keep these records of all these things for a
minimum of 5 tax-years
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That's hopefully a brief bit of information to get you thinking. I encorage you all to read some of the govenment and independent organisation help websites for detailed guidence on different aspects of self employment.
Also consider going on some of the FREE 'Starting up in self employment' help workshops:
- Newly self employed
- Business Expenses and Capital Allowances for the Self Employed
- Self Assessment Online
http://www.hmrc.gov.uk/bst/advice-teams-area/map2.htm
http://www.hmrc.gov.uk/workshophandouts/
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HM Revenue & Customs
http://www.hmrc.gov.uk/selfemployed/index.shtml
Regester for self assesment tax
http://www.hmrc.gov.uk/sa/register.htm
Record keeping
http://www.hmrc.gov.uk/sa/rec-keep-self-emp.htm
Business Link
http://www.businesslink.gov.uk/
Setting up as self employed
http://www.businesslink.gov.uk/bdotg/action/layer?topicId=1073875654
Business name checker
http://www.businesslink.gov.uk/bdotg/action/cntc
Direct.gov
Newly self-employed helpline
http://www.direct.gov.uk/en/Dl1/Directories/DG_10011000Tax information
http://www.direct.gov.uk/en/MoneyTaxAndBenefits/Taxes/WorkingAndPayingTax/DG_185198
Once you import your files they form an asset list in the Project pannel you can then drag them onto the Stage or Layers pannel if you already have a composition underway, or drag a file onto the New composition icon at the bottom of the Project pannel to automatically create a composition with the same dimentions and length as the footage you are choosing to start with.
You can set keyframes on these attributes by first clicking on the Stopwatch icon and then altering the values in the layer pannel or directly on the stage, at different frames of the composition. Keyframes are represented by grey diamonds (or yellow if selected with the mouse) on the timeline.
