Going self-employed in fitness? Here's what you need to know
In Monday's post I chatted about whether being employed or self-employed in the fitness industry might be a better fit for you. If you've mad your way to this post then chances are you're seriously considering going self-employed. I'm going to give you an honest break down of the information you need to know to get started. Fro an even deeper look into all of this, I'd recommend purchasing my Group Fitness Instructor's Start-Up Guide and Finance and Accounting for Fit Pros Guide. These two guides contain over 50 pages of insider info from my 4 years of being a freelance fit pro.
You need to tell the government you are self employed
The most important thing you need to do when making the leap to self-employment is tell the government about this change. If you are a UK reader, you need to do this through HMRC. You will need to set up as either a sole trader or limited company, and which set up you choose will depend on your earnings, tax treatment, and whether you need to employ or sub-contract staff, amongst other things. My finance guide has two pages dedicated to helping you work out the best structure for you. Once you tell the government that you are self-employed you will receive your UT (unique taxpayer number) and have to set up a government gateway account for you to file your tax returns. If you don't tell the government about any self-employed income then you could face a fine or even jail time. Even if you aren't self-employed yet but are planning to make the move soon, you can register now and get everything in place, then activate the account when you begin trading.
It is an undeniable fact that the worst part of being self-employed is admin. As much as I love a good spreadsheet, time spent doing boring admin tasks feels like it could be better spent being creative. That's why you went self-employed, right? There is a lot more admin to do as a self-employed person than an employee as you're running your own business. This will include cash flow management, filing expenses, paying bills, sorting out taxes as well as things like client check-ins and emails. My advice would be to batch these tasks and get them all done either once a day, week or month. If you reply to emails as soon as they come in you find yourself constantly in your inbox. By batching them and replying at a set time every day, you can clear your inbox and move on to the more fun stuff in your business!
Don't forget about taxes
When you are employee you probably don't think twice about the tax that comes out of your payslip every month. Taxes are an unfortunate fact of life but as an employee you aren't responsible for paying them. However as a self-employed human it is up to you to file a tax return every year and pay any taxes you owe. You need to budget correctly to make sure you have enough money at the end of the year to pay your tax bill. This HMRC calculator may help you work out your tax bill.
Protect your business correctly
Insurance is an incredibly important part of running a business and being self-employed. As an employee, all of your actions were probably covered by your place of work's insurance policy so you wouldn't be personally held responsible if someone fell over in a class or injured themselves during a session. However as a freelancer, you butt could be on the line if someone decides to sue.You need to make sure you have the correct insurances in place to operate. For most fit pros that is a minimum of public liability insurance. Check out this article I wrote on the types of insurance every fit pro needs for a bit more info.
Systems are key
As a self-employed person or business owner, you need to have systems for everything. This ranges from a system for creating invoices, a system for managing your cash flow to a system for creating social media content. Think of these like a handbook that you'd give to yourself if you were an employee at your business on the first day of the job.Break down how you do everything into a series of steps that you can flow through every time you do that task. It will save you years of your life (and sanity!) A great book to read about the power of systems is the E-myth by Michael Gerber.
If you find yourself still needing help with the transition to self-employment, definitely check out my finance guide and start-up guide. The info in those guides is a lot more detailed than I could fit into a blog post and breaks everything down step by step!