So, the numbers bit. Who’s earning what and is living the dream of going solo all its cracked up to be financially?
Despite
the obvious finiancial support an employee gets from their employing
organisation, most of the people we spoke to were unphased about
managing the financial aspect of starting out alone. Two thirds of you
just put your best foot forward and went for it, leaving a nervous
third of you daunted by the prospect of having to manage this side of
the business. The realities of how you get paid tells a different
story. Far more independents are disatissfied with the way they are
paid now. It’s nearly a 50:50 split, with those being happy with the
way you’re paid. By far the majority of individuals thought that ease
and simplicity had a higher importance than tax efficiency when they
set out the mechanism by which to remunerate themselves. And the
government crusade that “Tax needn’t be Taxing” must be doing something
right if 69% of you are opting for a self assessment approach versus
the 21% who prefer being paid for through a limited company.
When
it actually came down to the nitty gritty though, we asked those
independent professionals, to be honest and get the things off their
chest that irritated them. The top 3 annoyances were:
…and…
Other
bug bears like managing invoices, sorting out tax issues and waiting
for cheques to clear were much lower on the frustration list. Comment
after comment we got back was how detrimental it was on business to
spend all the time chasing late payments. We took this on board and are
going to try and help out here.
Whats the most important aspect of getting paid?
And as for what you actually earn… we were incredibly grateful for
those who let us know. There are two bulges of earning levels in the
results we got. The first group of freelancers peaks at around £41k to
£50k annual gross earnings. Below this amount, 18% of respondents were
earning between £11k and £20k and 12% were somewhere between £31k and
£40k. But sitting at the top of the earnings tree were a whopping 15%
of respondents who earn over £90k per year. We thought this was really
encouraging news; you can go freelance and still hit the big time (if
that’s what you’re after). With only one year’s worth of data we can’t
say whether earnings are on the rise, and the split was roughly 50:50
between those saying their take home pay was more than last year, and
those who thought their earnings had actually gone down. Next time we
ask the audience, we’ll try and correlate the findings of earnings with
hours per week or days per year worked to see if our envy is justified!
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