Registering as a Freelance Translator in the UK
How to register as a Freelance Translator in the UK
So, you’ve decided to become a freelance translator and want to make it official. You’ve got your business plan together, set up your website and perhaps even have a few clients under your belt. Now, it’s time for the legal stuff.
In the UK, independent freelance translators should register as a Sole Proprietorship (Sole Trader).
What does this mean?
This is the option I decided to go for as I am not ready to own my own company yet and want to remain as an independent, individual translator. If you’re a ‘sole trader’ this means that you are solely responsible for your own business as an individual and are considered to be Self-Employed in the UK.
What are you responsible for?
With great independence, comes great responsibility….or something like that. Being a Sole Trader means you are responsible for:
- Keeping records of your business sales and earnings
- Sending a Self Assessment tax return every year
- Controlling any business debts and/or bills
This can all be a bit overwhelming, I know, so if you’re not quite a financial genius it might be worth considering hiring an accountant or financial advisor to help you with your business finances. This way, you can rest assured that your outgoings and earnings are under control and that you are paying what you should be to the taxman; not too much, not too little.
What are the advantages?
The biggest advantage to being a Sole Trader is that you get to keep all profit made on your business after tax. This option also gives you greater control over your own finances, and ensures that you won’t pay too much tax as you can claim back on your business expenses such as translation software, training courses, computer upgrades, etc. Being a sole trader doesn’t limit you either, and you can still choose a company name and hire employees if you so wish.
What are the disadvantages?
There are also a couple of disadvantages of becoming a sole trader that you should be aware of.
Firstly, of course, you are solely responsible for the success of your work. You are able to hire employees, but you are essentially running your own business and so have to be willing to make all decisions that effect your taxes, income, funding and the way your business is run.
However, this is also an advantage as you are completely in control of everything that influences your work. As well as this, you aren’t seen as a separate entity by the law. This means that you could become liable for any debt you might build up. Unfortunately this could put your own home and personal savings at risk, so make sure to plan carefully and have your finances under control before becoming a sole trader.
It might even be a good idea to save some money up before going completely independent, so that you have a back-up plan should your income not be as high as your first expected.
To find out more about registering as a Sole Trader, simply visit the HMRC website here: https://www.gov.uk/set-up-sole-trader
Good luck, and welcome to the Self-Employed team!