Self-employment

Flexibility that comes with responsibility

To be a sole trader, a partner, or a member of a limited liability partnership as an individual rather than a company, you must be self-employed and registered as such with HM Revenue & Customs (HMRC). This does not mean that you can't also do other work as an employee, but the work you do for your business must be done on a self-employed basis.

If you are not sure whether this work counts as self-employment, ask yourself these questions:

Do you present your clients with invoices for the work that you do for them?

Do you carry out work for a number of clients?

Are you responsible for the losses of your business as well as taking the profits?

Can you hire other people on your own terms to do the work that you've taken on?

Do you have control over what work has to be done, how the work has to be done and the time when and place where the work has to be done?

Have you invested your own money in your business or partnership?

Do you provide any major items of equipment which are a fundamental requirement of the work you carry out?

Do you have to correct unsatisfactory work in your own time and at your own expense?

If you can answer "yes" to most of these questions then you are probably self-employed already, and should let HMRC know this immediately if you have not already done so. You may be fined £100 if you fail to register within three months of becoming self-employed. There is no fee for registration.

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