Self-employment pros and cons

• Self-employment is flexible. It can be easier to take time off when you want for things like medical appointments and holidays.
• You can do something you’re interested in.
• You are in control of your workload.
• You'll have the opportunity to work with a variety of clients and develop new skills.
• You'll also gain experience in setting up a business, including overseeing the finances and administrative work.
• Running a business means that you get to make your own decisions.
• If reducing your commute is important to you, you have a chance to do that or you could try working from home.
• Working remotely can help if you’re not comfortable meeting new people.

Responsibility and risks

• Your income is dependent on you. If you cannot work, your business will stop too.
• You will have less job security. It’s your responsibility to ensure you have enough work to guarantee you have a reliable source of income.
• You will have fewer benefits than an employee, such as sick leave, annual leave and parental leave.
• You rely on clients paying. Getting them to do this can be hard work.
• If you’re selling stock, this probably means that you’re relying on a supplier. They may put their prices up, run out of stock or not be able to supply on time.
• Running your own business has legal risks if you are a sole trader or limited company.

Setting up as a sole trader (GOV.UK)

Setting up a private limited company (GOV.UK)

Starting out

• You need to have enough money to get your business started, keep it running and live until you make a profit. This could take some time.
• You may find it hard to get credit with suppliers at the start.

Money and planning

• Check which benefits you can claim.
• You will need to plan for your retirement and pay into your own pension.
• If you employ someone, you must cover their salary before you pay yourself. You’ll need to pay into their pension too.
• You’ll need to manage paying for anything the business needs to run. This could include membership fees of professional bodies, rent and insurance. If anything that you rely on fails, you will need to pay for it.
• You’ll need a broad range of skills to run a business, like marketing and bookkeeping. You can employ someone to help you, but this will make it harder to make a profit.
• Importing and exporting stock means managing taxes and tariffs.

Working on your own

• Either you’ll be working from home or covering the cost of working somewhere else.
• Working on your own can be lonely.
• If you’re working from home, there can be distractions like the TV or family members.
• Protect your business ideas. Make sure people you talk to sign a non-disclosure agreement.

Is self-employment right for you? (Prospects)

Ready to get going?

Starting a business