Self-employment, freelancing and running your own business

What is self-employment? 

Self-employment (or ‘working for yourself’) is when an individual:

  • works for themselves instead of (or alongside) working for an employer that pays a salary, or a wage, through the HM Revenue and Customs (HMRC) PAYE online service.
  • is responsible for paying their own taxes and national insurance contributions.

Further information

What are the different types?

The four main types of self-employment are:

1. running your own business, social enterprise or charity.

2. starting up a partnership, where you join up with others (two or more people) to ‘co-found and ‘co-run’ a business, social enterprise or charity.

3. being self-employed as a sole-trader. Common examples of sole traders include restaurant owners, hairdressers, plumbers and electricians.

4. being self-employed as a freelancer. As a freelancer, you have flexibility in the way you work as it often involves winning contracts from clients to deliver work and projects. Many freelancers are registered sole traders, whilst others have decided to set up their own company. As a freelancer, you can have a range of contracts, one contract with one large company/ organisation or undertake portfolio working. Portfolio working combines a mixture of, often freelance, professional roles, some of which might be relevant to your degree or future career ambitions. Common examples of freelancing roles include graphic designers, illustrators, copywriters, bloggers and musicians.

What are the benefits?

Being self-employed, working as a freelancer or running your own business (social enterprise or charity) can be hugely rewarding. It can open up a world of possibilities including flexibility and a sense of autonomy. It can also give you the opportunity to think creatively, use your initiative and shape your own future.  Being your own boss can be challenging, however the personal satisfaction that comes with it can be huge.

Entrepreneurship might suit you if you like being in charge, influencing other people, taking risks, making things happen and are adventurous, assertive, ambitious, and motivated.

What opportunities are there?

Self-employment occurs in many sectors including accountancy, banking and finance, healthcare, information technology, law, leisure and sport and tourism.

Self-employment is growing in the UK, it accounted for 15% of the labour market in 2018, and this figure continues to increase. It is also becoming a popular option for graduates. According to HESA (2016/17 DLHE) 5% of graduates were self-employed/ freelance and 1% were running their own businesses.

Self-employment is most common in media and the creative arts and design. For those wishing to work in the creative and cultural industries this is an exciting and pivotal time. In the UK, recent statistics show the sector is increasing by 8.9% a year, making it the second fastest expanding industrial sector. According to the Creative Industries Council (CIC), the creative industries contribute £117.7 billion a year to the UK economy and there are over 3.2 million jobs. Indeed 1 in 11 UK jobs are within this growing creative economy. Recognising its growth the UK digital Strategy (2017) stated that ‘an estimated 1.2 million new technical and digitally skilled people are needed by 2022 to satisfy future skill needs.’

The South West has also seen the Creative Industries increase by a third. According to Creative Industries Economic Estimates (2016) the following numbers of people are employed:

  • IT, software, and computer services: 45,000
  • Music, and the performing & visual arts: 23,000
  • Publishing: 13,000
  • Advertising & marketing: 11,000
  • Architecture: 7,000
  • Design: 10,000
  • Museums, galleries and libraries: 8,000
  • Film, TV radio, video and photography: 12,000.

What about University of Plymouth graduates?

According to DLHE (Destinations Leavers Higher Education, 2016/17) a total 5.4% of graduates entered self-employment or started their own business. Over the past three years the following subject areas have resulted in the most self-employment students:

  • The Creative Arts & Design, including music, photography, fine art and design related subjects
  • Sport & Exercise Science
  • Computer Science.

What skills do I need?

Some people believe that entrepreneurs are born, however the characteristics of entrepreneurship can be developed by everyone through a combination of hard work, knowledge and patience. In order to be successful you need to understand the basic principles of business, along with the following qualities: 

  • energy and resilience
  • ability to work without direction and confidence to make decisions
  • self-discipline and self-motivation
  • natural networker
  • creativity and adaptability
  • ability to solve problems and learn from mistakes
  • willingness to take moderate risks
  • passion and belief in your business.

Winning clients is an important part of being a freelancer, and the key is to develop your professional networks; ask people you know who work in that area to introduce you to others and think about attending relevant networking events or joining relevant forums.

Don’t be put off if you think you don’t think you have the basic business acumen now, or all the qualities listed above. Everyone is likely to be stronger in some areas than others. It’s also important to remember that you will develop many of these qualities during your academic studies, however if you want to enhance these further there is a broad range of extra-curricular activities available that can help develop and foster these.

Registering as self-employed

If you’ve started working for yourself, whether that is earning extra money in addition to having a job, or you’ve started a business you’ll need to register for income tax and National Insurance contributions with the HM Revenue and Customs. Registering is simple, you just need to register with the HMRC.

Once registered you get a 10-digit unique taxpayer reference number, along with a code for the self-assessment online service. Please note that you have to do this if you are currently earning more than £1000 per year or if you intend to build up a steady income.

To find our more visit: https://www.gov.uk/working-for-yourself.

Commonly used phrases

There are lots of phrases used to describe ‘working for yourself’ and this terminology can become confusing, so here is our quick guide to the most commonly used terms:

  • Entrepreneur: someone who is dynamic and ambitious, sees opportunities, takes a risk and turns their ideas into new business opportunities.
  • Franchisee: Someone who has bought a branch of a business which is owned by one, central master company eg McDonald's Restaurants franchises.
  • Freelancer: Often working independently with their own clients, usually on more than one project at once and possibly for several organisations.
  • Portfolio career: Common in the creative industries and usually involves combining work in more than one career area. Often portfolio careers merge a role that is hard to sustain financially (such as acting) with a role that provides a regular income (eg office work).
  • Self-employed: Working for yourself rather than being a salaried employee for an organisation.
  • Social enterprises: A business which trades for social and environmental purposes, their profits are reinvested to sustain and develop their mission for positive change.

External sources of help

targetjobs – read some interesting articles around setting up your own business or becoming a freelancer.

Prospects  learn about the initial stages of self-employment: from developing your business idea to creating a business plan, working out start-up costs, managing cashflow and promoting your business. Find out if you've got what it takes to be an entrepreneur or freelancer.

Heart of the South West Grow Hub – for sources of business support our first point of contact when looking for information is the Heart of the South West Growth Hub as they have all the current/relevant information.

Gov.UK – useful information on registering to be self-employed and starting a business.

Shell LiveWIRE  The UK’s biggest online community for entrepreneurs aged 16–30. The website is full of useful links and information that will help you start up in business, design business plans etc. To access some of the facilities you will have to register for a free account.

Prince's Trust  The Prince’s Trust Enterprise Programme supports anyone aged 18-30 with an interest in business or self-employment.

Start Up Donut – general start-up advice advice.

Government start-up loan site

Outset – business start-up support for the South West.

Accelerating Womens Enterprise – a range of workshops for supporting females to set up a business.

Informi - How to start a business in 20 days  Useful step-by-step guide, plus more resources.

HMRC  Information regarding tax and National Insurance contributions for the self-employed.

Contractor UK First Timer Guides

Careers Service update

The Careers Service has now moved to complete online support for our students.

We can provide…

  • Answers to careers queries
  • One-to-one appointments through Skype or telephone
  • Signposting to online resources

Email careers@plymouth.ac.uk for more information or book an appointment using myCareer.

For placement support, please email placements@plymouth.ac.uk.

Advice if you are graduating in 2020

24/7 online resources and tools

Book yourself into one of our Coping with COVID-19 webinars. The following titles will become a regular feature throughout the coming months: Graduate Recruitment in a Time of Crisis, Job Search Techniques in a Turbulent Market, LinkedIn Masterclass, Phone and Video Interviews, Remaining Positive and Developing Resilience, Finding Part-time Work, Considering Postgraduate Study.

Techstars Start-up Weekend in Plymouth

The first-ever Techstars Startup Weekend Plymouth took place at the end of April 2019, on the theme of health and wellbeing. The event was organised by The Bridge Initiative and involved around 50 people including coaches, judges, attendees and other supporting roles, and resulted in five teams working full-time over the course of the weekend.

“It's so exciting that this is only the beginning for Plymouth; more of these affordable and innovative events will be coming to Plymouth in the future, which means more opportunities for students, creatives and those with entrepreneurial minds."

Discover the Techstars Start-up Weekend

iMayflower crowdfunding support

Crowdfunder UK are helping digital creative companies grow through a combination of expert crowdfunding coaching, events and extra funding.

What is crowdfunding?

Crowdfunding gives people a digital platform to validate creative ideas, raise awareness of new projects, and build lasting relationships with supporters. And it’s an innovative way to fund your start-up and grow your business!

Find out more about how Crowdfunder can help as part of iMayflower