"Going Pro" - the business stuff

[8bit]

I'm at a point now with photography where I'm starting to get asked to do bits and pieces of work for businesses. Nowhere near the point of packing in the day job yet though. So far it's mostly been doing stuff for friends with their businesses and they've helped me with something as a return favour but I've been approached by an unrelated company now to do some corporate shots, headshots etc.

I'm wondering now if I should be thinking about setting up a limited company to operate through, or would becoming a sole trader be a better idea at this stage? Are either required to be able to legitimately invoice another business for photography services?

I do actually have a 50% share in a limited company I set up when I started IT contracting, my wife is the other director there and she still trades through it but I'm in a PAYE role so not using it. That business is registered as an IT consultancy though so I presume I shouldn't invoice via that even for now? If I went down the sole trader route then am I right in thinking that's just some other income that needs declared on my SATR?

[Simpo Two]

Sole trader is all you need. The income will need to be declared if you've used up your income tax allowance elsewhere, so keep records.

Now all you have to do it turn up with suitable kit, look like you know how to work it, and get results the client is happy with

[StevieBee]

You may also want to look at registering for VAT. You can do this as a sole trader and there is the ability to retrospectively claim VAT paid on equipment purchased four years before registration providing you still have the items and the receipts. If you've been spending, then this may repatriate a fair bit of money to you to help kick start your business.

[Simpo Two]

StevieBee said:

You may also want to look at registering for VAT. You can do this as a sole trader and there is the ability to retrospectively claim VAT paid on equipment purchased four years before registration providing you still have the items and the receipts. If you've been spending, then this may repatriate a fair bit of money to you to help kick start your business.

If the clients are VAT registered and the OP needs to buy equipment that's a good idea, if he doesn't mind some extra admin.

It backfires a bit once you've got the kit and if your clients are not registered, as you become 20% more expensive. That's why when 90% of my work was weddings I de-registered.

I think for one small job I wouldn't bother. But if the OP is going to do significantly more of the same it's worth considering.

Edited by Simpo Two on Friday 24th September 14:07

[8bit]

Thanks chaps, sounds like sole trader is the way to go. I can't see I'll be doing a lot of buying stuff unless I end up selling a lot of prints but that's good to know.

Just had another thought, what about insurance? I have personal insurance for my camera, lenses etc. but that may need upgrading if I'm using them for business purposes. What about liability insurance etc.?

[2 sMoKiN bArReLs]

You should check out liability insurance. Little chance of needing to claim, but for £50 it's peace of mind.

[Mr Pointy]

8bit said:

Thanks chaps, sounds like sole trader is the way to go. I can't see I'll be doing a lot of buying stuff unless I end up selling a lot of prints but that's good to know.

Just had another thought, what about insurance? I have personal insurance for my camera, lenses etc. but that may need upgrading if I'm using them for business purposes. What about liability insurance etc.?

Have a look at Caunce O'Hara:
https://www.caunceohara.co.uk/freelancers/photogra...

You definately need stuff like PL insurance in case someone trips over your camera bag & breaks a leg. Don't forget your car insurance needs to cover Business Use (Class 2 I think, but check). You need to inform HMRC & register within a couple of months but I don't know if you are already doing Self Assessment in which case you may be covered already.

Get a new credit card & use it exclusively for business use as it makes tracking expenses far easier. Keep mileage records & you can claim the relevant percentage of the cost of running your car.

[Simpo Two]

8bit said:

Just had another thought, what about insurance? I have personal insurance for my camera, lenses etc. but that may need upgrading if I'm using them for business purposes. What about liability insurance etc.?

If it's your career it makes sense - and some places insist on it. But for one job, I wouldn't bother. Just don't leave your kit where people can fall over it. The biggest new challenge you face IMHO is expectations. Has the new client seen your work? If he has, and wants some like it, you should be fine.

[Beggarall]

2 sMoKiN bArReLs said:

You should check out liability insurance. Little chance of needing to claim, but for £50 it's peace of mind.

Interested to know where you can get liability insurance for £50! I got a quote at the Photography Show for about £365 although that did include equipment insurance. If you are going pro then I think public liability insurance is a must. If you are doing events or weddings you will be asked for it. Apart from that there is always a risk when working commercially that something goes wrong and even as an amateur there are risks - such as engaging a model for a shoot who then trips over your tripod and can't wok because of injured wrist/ankle/other bits! I would also include some sort of legal advice/protection if you are working with contracts - just thoughts.

[FunkyGibbon]

Beggarall said:

Interested to know where you can get liability insurance for £50!

I'm considering something similar, so just checked on MoneySuperMarket - £1,000,000 PL cover for £51.31 - up to £155.22 for £10,000,000 of cover.

[8bit]

Thanks all, very useful input - much appreciated.

At this stage I'm a long way from packing in the day job but I would like to be in a position to take work that I can fit around the 9-5 with a view to making the switch if/when I feel that becomes feasible, so I need to be able to legitimately operate as a freelance photographer whilst simultaneously trying to keep overheads as low as possible. Sounds like sole trader is the way forward there, at least for now. I am already registered for SATR so I guess in theory it's just some additional income to declare at this stage.

For those who do a bit of freelance commercial or corporate work - is it expected at all that you operate as a limited company or are your clients happy with sole traders?

[tog]

8bit said:

For those who do a bit of freelance commercial or corporate work - is it expected at all that you operate as a limited company or are your clients happy with sole traders?

I only do commercial work and have been a sole trader for 20 years. Clients have ranged from huge multinational banks down to other sole traders. Only problem with big companies is all the paperwork required to get onto their systems as a suppler, but once you've filled in a modern slavery policy form and completed your environmental statement you're almost half way there

[Fordo]

8bit said:

Thanks all, very useful input - much appreciated.

For those who do a bit of freelance commercial or corporate work - is it expected at all that you operate as a limited company or are your clients happy with sole traders?

I've been a freelance as a filmmaker / DOP, for about 7 years now. I've been a sole trader, and worked with big and small companies. Simpo makes a very good point about VAT. I recently became a vat registered sole trader, made sense when investing in more equipment - It didnt make a different for most of my clients, who are also vat registered businesses - But to a couple of smaller clients who aren't, I was suddenly 20% more costly.

So i'd say being a sole trader is the way to go, for your business. Its a lot simpler that being a limited business. Just remember that as a sole trader. that you are the business, so any business debt, or if for whatever reason the business is sued - unlike a ltd company, is all directly on yourself. So something like professional liability insurance, isnt a bad idea

[Simpo Two]

8bit said:

For those who do a bit of freelance commercial or corporate work - is it expected at all that you operate as a limited company or are your clients happy with sole traders?

For photography, nobody asked or expected me to be limited. Photographers are generally 'lone wolves' not companies. There were one or two wedding venues who asked for PL though.

In the video world I did meet one or two prospects who only wanted to deal with a company; I think it was a corporate box-ticking exercise. I certainly wasn't going to incorporate just to pitch for one job.

[tog]

Simpo Two said:

There were one or two wedding venues who asked for PL though.

I would definitely recommend you have PL insurance for your own protection if nothing else. I fairly often have clients who ask to see the certificate. I have £5m cover these days, provided by Glover and Howe alongside my kit cover.

[DavidY]

tog said:

Simpo Two said:

There were one or two wedding venues who asked for PL though.

I would definitely recommend you have PL insurance for your own protection if nothing else. I fairly often have clients who ask to see the certificate. I have £5m cover these days, provided by Glover and Howe alongside my kit cover.

I would definitely recommend Glover and Howe, I just had an accidental total looss on a Fujifilm GFX50S+Lens recently (not an insignificant claim!) I claimed on the Monday and by 6pm Thursfay the full replacement value (less excess) was in my bank account - 3.5 days from claim initiation - I was very impressed!

Edited by DavidY on Thursday 7th October 06:40

[croyde]

I've been a sole trader for 30 odd years in television. A big OB company decided, about 2 years ago, that it'd only use people who were Ltd companies and I almost set myself up as one but then the big jobs stopped due to Covid.

Then Sunak buggered the Ltd companies, particularly the single person ones but the Sole Traders were looked after with grants.

I thank my stars that I didn't change my status.

The daft company still insists on only using Ltd companies despite how badly they were treated so in my case I got a Ltd mate to 'employ' me.

You could work under an umbrella company but then you'll end up paying tax and NI at source as well as the employer's portion of NI as well.

For me staying Sole Trader has kept things simple and yes, PLI is easily found for around £60 a year but obviously more if you want to insure equipment.

Due to Covid I took on a full time position doing shifts plus I still freelance as well. All helped with my accountant who only costs me £400 a year but saves me loads with his considerable knowledge, especially as rules change all the time.

All the best with your venture.

[tog]

DavidY said:

I would definitely recommend Glover and Howe, I just had an accidental total looss on a Fujifilm GFX50S+Lens recently (not an insignificant claim!) I claimed on the Monday and by 6pm Thursfay the full replacement value (less excess) was in my bank account - 3.5 days from claim initiation - I was very impressed!

Edited by DavidY on Thursday 7th October 06:40

Yes, they are very good. I destroyed a 5D mkIV and lens earlier this year and the claim was settled long before the associated bruising passed. I've been with them for probably 25 years.

[ch37]

I use Photoguard, in 70ish weddings at everywhere from village halls, the Roman Baths, to stately homes and everything inbetween I've been asked for my PL certificate once (at a castle), but it's peace of mind and it's combined with my equipment cover anyway.

If you shoot motorsport however, it's often required and typically needs to be £5m+.

[NS66]

8bit said:

Thanks all, very useful input - much appreciated.

At this stage I'm a long way from packing in the day job but I would like to be in a position to take work that I can fit around the 9-5 with a view to making the switch if/when I feel that becomes feasible, so I need to be able to legitimately operate as a freelance photographer whilst simultaneously trying to keep overheads as low as possible. Sounds like sole trader is the way forward there, at least for now. I am already registered for SATR so I guess in theory it's just some additional income to declare at this stage.

For those who do a bit of freelance commercial or corporate work - is it expected at all that you operate as a limited company or are your clients happy with sole traders?

Good look with your venture but beware.

I have been a photographer since my teens and has always been a passion. I turned that passion into a business for a good 10-12 years running along side my day job. My day job is demanding and rewards based so can be very lucrative which made the leap to full time photography business quite difficult. I think if I had had a mundane low paid job I would have leapt at it perhaps.

You need to control what you do and dont let it take over your life, I was working most evenings processing and prospecting for business whilst weekends was shooting - either studio work ( had a studio for 10 years ) or weddings which is where the money is. I limited myself to 20 weddings a year but that is still a vast amount of work to fit in.

You will need to keep records income and outgoings and get a good accountant - just as a sole trader declaring additional income on self assessment. Get some public liability insurance and good equipment cover, You will find you do plow a lot of your income into your equipment upgrades etc - you need to kerb this to make the business viable!!!

I got to the point it I was earning 50/50 from both jobs and my day job suffered which caused considerable stress so beware juggling although I guess I was doing it in a time when digital had just started to become the norm and phone cameras were no existent or not so good.

Hope this helps but if I had one word of warning - if photography is your passion it might not be after a few years and just become a chore. I still enjoy it but loved it more when I was learning really. Remember also a photography business is just a tiny element of actually photographing - your time is taken up more in processing, administration and selling yourself and your business.