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How to start your business as an independent tradesman

Whether you’ve recently finished an apprenticeship in your chosen trade or have been working for a company for many years, you may feel the time is right to set up your own business. The chance to work independently is often too good to miss, but how can you get everything up and running smoothly? There’s so much to think about, be it affordable van insurance for the vehicle you’ll be driving day in day out or your business structure. So, here are some useful tips to set you off on the right foot.

  1. Find a legal structure for your business

When going it alone, you must find a legal structure for your business. You could set up as a limited company – although this can be costly and involves lots of paperwork – or register as a sole trader. According to gov.uk, being a sole trader means you run your own business and are self-employed. You’re responsible for your business debts, bills for anything your business purchases, keeping sales and expenses records, completing a Self-Assessment tax return once a year, paying income tax and national insurance. Being a sole trader, however, does not mean you have to work alone. It’s perfectly reasonable and legal to hire a team.

  1. Think about tax, VAT and national insurance

There’s a lot to think about when becoming an independent tradesman including budgeting for tax and national insurance. Often, there’s a delay between registering as a sole trader and receiving your first tax bill, so it’s a really good idea to keep a spreadsheet of your finances and to put money aside so you’re not suddenly out of pocket down the line. If your revenue is over £70,000 a year, you’ll also have to register for VAT. You can register to pay VAT before you have to by law but always do your research as there’s plenty of fine print to get your head around.

  1. Take out the right insurance policies

As an independent tradesman, an unforeseen incident can put you out of business if you haven’t got the right safety measures in place. Business-specific insurance policies are designed to give you peace of mind in the event of an emergency and will help you stay on track financially. Policies to consider include van insurance as comprehensive policies cover you, your van and its contents – but be sure to read your terms carefully, to check that your contents are covered as part of your insurance policy. If you use a car for work too, don’t assume your regular car insurance will cover work-related journeys. There are often specific insurance plans for this. Tradesman liability insurance can also protect your business for claims from third parties for damage to their property or personal injuries.

  1. Invest in the right tools

If you’ve been an employee for many years, you were probably supplied with the relevant tools. As an independent trader, you’ll need to invest in your own, but these should be of a high quality to ensure you can fend off competitors and carry out jobs to the best of your ability. Stocking up on the tools you need can be expensive, but it’s something you should factor into your business budget right from the start. Also, make sure the vehicle you choose to work from has the right storage capacity for the tools you require.

  1. Market your services

Once you’ve laid down the foundations, it’s time to spread the word about what you do. Having a website fully optimised for local search queries is a must and you might decide to promote yourself on local listing sites or national platforms such as Top Tradesmen or Checkatrade.com. Targeting the press in your area, handing out flyers and printing business cards to give to clients is also a great way to get business. If you’re good at what you do, you should find word of mouth is also a great avenue for drumming up clients. But that should happen organically if you focus on carving out a reliable reputation.

Starting up as an independent tradesman takes time and energy, but when done correctly it can be extremely profitable.

 


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