‘Going freelance’ means setting yourself up as a business. To do this, you have to formally set up a legal business structure and let the tax authorities know that you are operating.

You need to be aware that ‘freelance’ is a layman’s term, and not an official category used by the Government to classify workers. Freelancers themselves use different terms to describe what they are, such as freelancer, contractor, consultant, independent professional, interim, portfolio worker, self-employed, business owner.

The unifying factor is that freelancers are their own bosses and have business-to-business relationships with their clients. There is a strong tradition of freelancing in certain industries such as media, IT, consulting; artists and designers often freelance as they work on short-term projects. Therefore, some freelancers work on long-term contracts, others on a series of fast turnaround projects, whilst others work with several clients at a time.

As a freelancer, you can use a range of legal structures to run your business. Please see the table below for the most used trading structures:

*Incorporated = your business is a legal separate entity; Unincorporated = you and your business are one and the same, there is no legal separation

Some freelancers work through recruitment agencies.  It is important to remember that if you are a sole trader, you can only be paid by the end client and not by the recruitment agency. In this case, you invoice the client directly and the agent charges the client a separate commission for finding you.  Other freelancers work directly with their clients. IPSE offer a lot of useful advice for freelancers.  

Because as a freelancer you are contracting your services to a client, it is important to draw up a contract with your client for the services your business will provide. Therefore, this is not a contract of service with you personally but with your business. The contract should accurately reflect the relationship between the two parties, and should include (a) clauses that demonstrate your ability to send substitutes, (b) the lack of mutuality of obligation and that (c) you have direction and control over your work. 

As with any business, remember that you need to have insurance that is required by law as well as insurance for what makes sense from a commercial point of view. 

To find out more about the above, please search the resources on the IPSE website.

Each year a few students choose to go self-employed and start their own business directly after graduation and most of these have had experience of entrepreneurial activities before and during their degree course.  

Many sectors and careers lend themselves well to self-employment, including journalism, certain legal and medical professions, and the creative and performing arts sectors. 

The financial help offered by The Princes Trust and Shell Livewire make starting a business a realistic option and we offer lots of training and events to help you realise your dream; please visit Student start-ups to find out more.