In the simplest terms, self-employment means working for yourself, rather than an employer. It can give you greater control over things like when and where you work, as well as who you care for.
As a self-employed carer, you could:
- Build your own schedule, choosing when and where you work.
- Have the opportunity to earn more than a traditional annual salary.
- Choose the clients you work with, rather than being assigned placements.
- Gain new skills in things like bookkeeping and organisation
Interested in becoming a self-employed carer on the Elder platform?
What about tax?
When you’re employed, tax and National Insurance are automatically deducted from your weekly or monthly pay. However, when you become self-employed, you’ll be in charge of managing and paying your own income tax and national national insurance contributions by completing a self-assessment each year.
This may seem daunting at first, but it doesn’t have to be. In fact, working as a self-employed carer can be made easier simply by remembering a few best practices, and using some handy online tools and apps.
Work out your tax each month
Because your income tax and National Insurance won’t automatically be deducted from your pay, some carers find working out their contributions, and moving these into a savings account each month can provide peace of mind when it comes to paying their tax bill each year. You can work out how much to put away each month with free tools like MoneySaving Expert’s Tax calculator
How to become self-employed
It’s important to let HMRC know that you’re self-employed as soon as possible. You can do this through their online registration form. Or by calling them on 0300 200 3504.
Make sure the contact details you provide to HMRC during your registration are correct, as they’ll send you text reminders when it’s time to submit your tax return, as well as emails offering general help and advice on things such as:
- The best way to keep records of your income
- How to claim business expenses, such as petrol if you drive, and work clothes
When you sign up with HMRC, they may ask if you’d like to be classed as a sole trader, or a limited company – which can be confusing.
A sole trader is simply a person who is self-employed, and who’s the sole owner of their business. As a self-employed carer – you are your business, and therefore becoming a sole trader is likely to be the most appropriate option for you. There’s far less paperwork too, as sole traders usually only need to submit an annual tax return.
Becoming a limited company gives your business it’s own separate identity, and while this can have its advantages, it also means more responsibility for you, and potentially more paperwork. A limited company classification is often something to consider further down the line, once you’re comfortable with self-employment, or have reached a certain level of earnings.
If you’re unsure what you’d like to register as, HMRC will be able to offer personalised advice.
The deadline for completing your tax return and paying what you owe is the 31st January, and is the same each year.
However, tax is calculated from April to April, rather than January to December. This means that you can complete your tax return anytime after April each year – getting it out the way and giving yourself more time to pay.
Your self-assessment tax return can be completed online through the Government website. The online form is split into various sections, and each question has an inbuilt prompt offering helpful information if you get stuck, or if you’re unsure how to answer.
Making self-employment easier
Keep track of your earnings
Today, software and mobile apps have transformed self-employment, making it a lot easier to keep track of your earnings. Tools like FreeAgent for example, can help you manage your income, store important documents, and even autofill 90% of your self assessment form. Coconut is another useful tool that can connect with your bank account to track your income and expenses, and work out how much tax you’ll need to pay. Take the time to find a tool or approach that works for you.
If in doubt, ask an accountant
While you can submit your tax return yourself online, if you don’t feel comfortable doing this, it may be a good idea to hire an accountant to take care of this for you. The cost of an accountant to submit your tax return usually starts at around £120 per year, but the peace of mind it can bring can be invaluable.
Caring with Elder can unlock self-employment support
After they’ve provided their first day of care, carers on the Elder platform can access a range of external loyalty rewards, including self-employed assistance services from a trusted third party.
These services include advice and guidance on managing your money, making your tax contributions and more.
What are the benefits of joining the Elder platform?
We’ll connect you to an expert carer team, and a 24/7 helpline during placements.
You’ll be able to browse and apply for 100s of placements easily through the Elder Hub, with no need to advertise.
We’ll reimburse your travel costs to and from your placement.
Each day of care you provide will unlock third party rewards such as mental health therapy, Injury & sickness cover and shopping discounts.
All active carers get free access to an external e-learning platform, where you can access courses and grow your specialist skills.
We’ll arrange quality respite cover for your client when it’s time to take a break.