Glossary

B

Breadcrumbing

a client leading you on, with potential offers of work, but never signing the contract.

C

Corporation Tax

Tax you pay on business profits, when registered as a limited company.

F

Freelancer

An individual working in self-employment, providing services to a client on a project by project basis.

FSCS protection

FSCS protects customers of financial services firms that have failed, to help keep your business funds safe.

G

ghosting

being ignored by a client, despite having things to resolve.

GPSR - General Product Safety Regulation

EU regulation designed to ensure all products sold in the EU are safe and meet certain standards.

H

HMRC

HM Revenue & Customs (HMRC) is the tax authority of the U.K. government.

I

ICO

The Information Commissioners Office (ICO) is the UK's data privacy watchdog.

Income Tax

Tax due payable to anyone earning over a certain income in the UK, and the primary tax you'll pay when you're self-employed

IR35

Tax law designed to level the amount of tax paid by those in employment and self-employment.

L

A limited company is one of the legal formations of a business in the UK. Whilst you're not technically self-employed if you're a limited company director, many sole-owners of limited companies describe themselves as self-employed.

M

Making Tax Digital

A UK government initiative to digitize tax reporting, requiring businesses and individuals to use software to submit tax returns online.

N

National Insurance

National Insurance is a tax on earnings and self-employed profits. There are different types of National Insurance, you'll need to understand the differences.

O

Office of the Small Business Commissioner

An independent body, set up to help small businesses deal with late paying larger companies.

P

Payment on Account

Paying your income tax in advance, as is mostly commonly required by the self-employed.

S

Self Assessment

The process of calculating and reporting your income and expenses to HRMC each year, rather than being taxed at source.

Side-Hustle

A side-hustle is additional paid work done alongside regular employment, often as a way of earning extra income or testing out self-employment.

Sole Trader

A sole trader is considered to be ‘self-employed', and is the singular owner of a business, entitled to keep all profits but liable for all losses.

U

UTR

Universal Tax Reference - a unique identifier for you, when you're completing your Self Assessment tax return.

V

VAT

Value Added Tax, additional tax you'll be charging your customers and liable to pay to HMRC, when your turnover is over £90,000

B