How to be Self-employed

Self-employment

So you’re thinking of setting up a creative business of your own? As an arts graduate you are ten times more likely to be self-employed than any other kind of graduate. For many it is the logical route to success in the arts, whether you’re a craftsperson, artist, designer or photographer. Why?

The Advantages

You’re in charge of everything: work patterns, pay, selling, location. You’re the boss and you keep all the profit generated. It is easy to set up and there are few legal requirements other than notifying the Inland Revenue and sorting out your tax code and National Insurance contributions within the first few weeks of setting up. You choose your hours, choose your work style and pursue the course of development at your own speed. In other words you can be very creative in your work and lifestyle with a flexibility unknown in employed situations.

Many creative workers successfully spend their entire working life as freelance or self-employed. For many others it is part of their ‘portfolio’ way of working – which includes running your own enterprise part time, some teaching and a part time job say working in a gallery or photography shop.

In the early days you can offset losses in self-employment against any tax paid from part-time employment, which can be very useful when you are investing in equipment to start up.

So why doesn’t it suit everyone?

The Disadvantages

You are liable for all your debts: that means if you incur debts in your trading and you can’t pay off, then the cash and property you own are liable to be used to pay off all the money you owe – your cash, your car and house are therefore at risk.

It is difficult to raise money to set up or expand as you may have little to offer a bank in the way of security.

As you are the only person in the business (though you may employ others if you wish) every decision falls on your shoulders; and not everyone likes the responsibility or can handle the never ending pressure. It is difficult to take breaks or have holidays for when you are not designing or making you are probably not earning either.

You are responsible for all your financial management and marketing and need a range of skills to cope with not only the creative side but also the day to day management. So in that sense even a fine artist is really just a small business like any other.

You will probably need some kind of workshop or studio with the basic minimum of equipment which of course all costs money; not forgetting insurance and maintenance costs. This can tie up much of your money early on …and can tie you down to one location!

Skills Base

Assuming you are good at the creative side of being self employed (though development is essential over your working life), what are the other skills a creative business person needs?