Image by Alltechbuzz from Pixabay
By Henry Brown
Right now, increasing numbers of people are switching to freelance modes of working. This isn’t all too surprising. Over the past year and a half, Covid-19 has spread across the world, changing the way that we work. To follow government guidelines associated with social distancing, many businesses have been unable to operate on a face-to-face basis, and many employees have been asked to work from home.
As we’ve worked remotely, many of us have started asking ourselves why we can’t connect with clients directly, rather than working for a business on a set income. We’ve grown to understand that freelancing offers a lot more freedom than the average employed role. You become your own boss. You can decide how much you work and how much you charge, taking more direct control over your earning potential. You can decide who you want to work with and how long you want to work with them, allowing you to foster positive working relationships that you enjoy.
Of course, with freelancing can come some difficulties and for many freelancers, the key challenge is managing the financial end of the business and making sure your invoices get paid on a timely basis. Here are some steps you can take to simplify this process for yourself!
Creating contracts
The first thing you should do before undertaking any work for any client is to come up with a contract. This will lay down the rules of the agreement, making sure that everyone will stick to it. Your contract should determine the exact work that is being expected of you, when it will be delivered by and the rate that you are charging for it. You may also want to include information adding deadlines to payments, adding extra charges per day that the payment is late. This encourages clients to pay the right amount on time, helping you to manage your finances better.
Generating invoices
Once you’ve completed a project, you need to create an invoice. This will help you to let your client know that payment is due and how much they need to pay. It will also include your payment details so they can deposit the money in the right bank account for you. If you’re stuck as to where to start with your invoice, you can use invoice template google docs to help.
Managing taxes
Of course, when you freelance, you have to pay tax and other essential contributions, such as national insurance, the same as everyone else. The difference is that you need to manage your tax independently or with the help of an accountant. Every time you invoice and are paid, make sure to deduct the tax and other costs you need to pay to the government and keep them in a separate pot to pay back to the government at the end of each fiscal year.
Sure, freelancing can seem complicated. But it’s just a new mode of working. You’ll quickly fall into the swing of things and manage your payments as if it’s second nature to you. Hopefully, some of the information provided above will help get this process started out well for you!
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Henry Brown is an online marketing executive. When he isn’t talking shop, he’s roaming the streets of London, uncovering the extra-ordinary in the ordinary.
