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jimspeed |
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jimspeed World Chat Champion
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Itchy |
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Itchy Super Spammer
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Baffler186 |
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Baffler186 World Chat Champion
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Posted: 15:25 - 04 May 2018 Post subject: |
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Not sure about VAT etc, but my cousin is a mechanic. He threatened to up and leave his employer's garage about 15 years ago to go self-employed. They didn't want him to go so begged him to do 2 days at the garage per week.
This worked out for him because he stayed on top of training/competencies through the garage. It also allowed him to keep in check with all the up-to-date diagnosis software.
At home, he has a huge garage, inspection pit and is MOT certified. He can do most "parts" jobs on all cars, but is limited to Audi and VW and one or two others because the diagnosis software is so expensive and IIRC needs updating every year or two. For himself he works 40 hours a week minimum, not including 2 days/week at his employers. He's not short of a bob though.
The biggest problem is newer cars, especially because as a local guy he obviously gets lots of referals from local people, friends of friends and family. They expect diagnoses and parts for an Audi or BMW to be £100 and then moan when the bill comes in at £700. But he has to charge that to cover the software and other stuff I don't understand.
Will you get enough work where you live, and how much do you plan on advertising? ____________________ Current: 2009 SV650 S, 1990 Kawasaki GT550
Previous: 2009 CBF125, 1998 GSF600, 2004 FZ6 Fazer, 1978 CB400a Hondamatic |
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stephen_o |
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stephen_o Spanner Monkey
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Shaft |
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Shaft World Chat Champion
Joined: 27 Dec 2010 Karma :
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Posted: 20:54 - 04 May 2018 Post subject: Re: Going self employed. Pitfalls/benefits |
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jimspeed wrote: | Hi folks I'm a bit stuck at the moment.. I have worked at the same place for 25 + years but now I think it is time for a change.
I'm a mechanic and mainly work on vw group cars but the small family firm I originally worked for has grown and now there is just no respect or loyalty anymore.
I'm currently employed but seriously thinking about going self employed as I know someone who is starting up their own workshop mainly restoring and servicing old vws and he is quite keen for me to go work for him.
I have never been self employed but fancy a go at it I currently earn around 350 a week so not exactly brilliant money and should be able to better that but how does tax and vat ECT get calculated? And pitfalls against doing it ? |
A word to the wise - as a newly self employed person, don't get involved in restorations, unless you're on an hourly rate and can clock in and out, each time you put anything into a long term project.
All restorations do is eat time and space - it looks nice when the customer comes in with a few grand every once in a while, but by the time you divide it up into the weeks and months it takes you to get anywhere, not to mention the forgotten costs like hours on the net trying to source parts etc, you will realise there's no money in it.
The only real way to make money from restoring is to do nothing else and have a number of vehicles in various stages of work, so you have customers constantly drip feeding you cash.
Let your mate play at being Fuzz Townshend if he wants, you stick to the fast turnaround servicing and put some folding in your pocket every week. ____________________ Things get better with age; I'm close to being magnificent........
20 RE Interceptor, 83 Z1100A3, 83 GS650 Katana
WooHoo, I'm a Man Point Millionaire! https://www.bikechatforums.com/viewtopic.php?t=234035 |
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stephen_o |
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stephen_o Spanner Monkey
Joined: 02 Aug 2011 Karma :
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Posted: 21:56 - 04 May 2018 Post subject: Re: Going self employed. Pitfalls/benefits |
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Shaft wrote: | jimspeed wrote: | Hi folks I'm a bit stuck at the moment.. I have worked at the same place for 25 + years but now I think it is time for a change.
I'm a mechanic and mainly work on vw group cars but the small family firm I originally worked for has grown and now there is just no respect or loyalty anymore.
I'm currently employed but seriously thinking about going self employed as I know someone who is starting up their own workshop mainly restoring and servicing old vws and he is quite keen for me to go work for him.
I have never been self employed but fancy a go at it I currently earn around 350 a week so not exactly brilliant money and should be able to better that but how does tax and vat ECT get calculated? And pitfalls against doing it ? |
A word to the wise - as a newly self employed person, don't get involved in restorations, unless you're on an hourly rate and can clock in and out, each time you put anything into a long term project.
All restorations do is eat time and space - it looks nice when the customer comes in with a few grand every once in a while, but by the time you divide it up into the weeks and months it takes you to get anywhere, not to mention the forgotten costs like hours on the net trying to source parts etc, you will realise there's no money in it.
The only real way to make money from restoring is to do nothing else and have a number of vehicles in various stages of work, so you have customers constantly drip feeding you cash.
Let your mate play at being Fuzz Townshend if he wants, you stick to the fast turnaround servicing and put some folding in your pocket every week. |
Just re-read your original post - as per above and my original reply - if it is that you are working FOR HIM and not on hourly rate as an employee then my advise would be - NO. I don't have experience of the motor trade but I have been self employed for most of my working life as Insurance Broker, Plumber and Retailer 3 times. It is very very easy to lose money, very hard to make money especially in an area where a customer can "nit pick". ____________________ current scoot 2009 Yamaha YBR250 + Current Pootle 2013 Nissan Leaf |
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jimspeed |
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jimspeed World Chat Champion
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jimspeed |
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jimspeed World Chat Champion
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Posted: 22:13 - 04 May 2018 Post subject: Re: Going self employed. Pitfalls/benefits |
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Shaft wrote: | jimspeed wrote: | Hi folks I'm a bit stuck at the moment.. I have worked at the same place for 25 + years but now I think it is time for a change.
I'm a mechanic and mainly work on vw group cars but the small family firm I originally worked for has grown and now there is just no respect or loyalty anymore.
I'm currently employed but seriously thinking about going self employed as I know someone who is starting up their own workshop mainly restoring and servicing old vws and he is quite keen for me to go work for him.
I have never been self employed but fancy a go at it I currently earn around 350 a week so not exactly brilliant money and should be able to better that but how does tax and vat ECT get calculated? And pitfalls against doing it ? |
A word to the wise - as a newly self employed person, don't get involved in restorations, unless you're on an hourly rate and can clock in and out, each time you put anything into a long term project.
All restorations do is eat time and space - it looks nice when the customer comes in with a few grand every once in a while, but by the time you divide it up into the weeks and months it takes you to get anywhere, not to mention the forgotten costs like hours on the net trying to source parts etc, you will realise there's no money in it.
The only real way to make money from restoring is to do nothing else and have a number of vehicles in various stages of work, so you have customers constantly drip feeding you cash.
Let your mate play at being Fuzz Townshend if he wants, you stick to the fast turnaround servicing and put some folding in your pocket every week. |
Shaft.. he has a decent collection of cars and vans that he wants help with initially I agree doing that sort of stuff is no way to earn living I would much rather spend an hour doing a REMAP or fitting some brake pads.. ____________________ Hyosung cruise 125(passed test on, sold) Kawasaki el 252 (better than expected but sold on) Kawasaki GPZ500S first "big"bike.(sold) ZZR600 E5..Z750 2007,ER5, currently on a 2008 Enfield bullet electra x and loving it..
,"Alpha-9: Is there any correlation between dyno rod and dyno kits?" |
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BTTD |
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BTTD World Chat Champion
Joined: 22 Nov 2012 Karma :
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defblade |
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defblade World Chat Champion
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Diggs |
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Diggs World Chat Champion
Joined: 03 Apr 2007 Karma :
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Posted: 14:39 - 05 May 2018 Post subject: |
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Been self-employed now since 1998 in a variety of roles.
The first thing you'll experience is a lack of cash as folk take too long to pay, so make sure you have enough put by to last 3 months.
Next thing will be the holiday situation. You'll start out thinking you are your own boss but soon realise that the demands of your customers determine when you work. You probably won't want to risk a decent holiday for a few years, until you have the confidence to know that your regular client-base won't go elsewhere if you aren't around for a fortnight. Took me 10 years to realise this...
Get an accountant. More expensive than a bookkeeper or doing things yourself, but a decent one will save you money in the long-run. The knack is to make minimal profit to reduce your tax bill...
Avoid VAT Registration for as long as you can as it is a ballache, will make you less competitive and opens you up to VAT inspections and fines...
As previous posters have said, put money aside for tax. Remember that this isn't your money so ffs don't do what I used to do and spend it on nonsense (like a Bimota) in the hope that I'd earn enough to pay when it came to it. It does catch up...
Learn when to say no to work - the worst mistake is to say you can do something when you can't, because you'll end up not wanting to answer the phone and you'll lose future business that way.
Don't be afraid to diversify - go on courses if you get the chance as this reduces your tax liability and opens new doors.
Avoid mate's rates as much as possible, because people will expect you to work at cost. This is a mug's game.
Don't be afraid to work regular hours for other firms whilst self-employed. Its how he world works nowadays.
Delete your old social media accounts if they make you look like a prat. Customers will look and judge you on the content of these.
Use forums to advertise, but do it on the appropriate days only.
Word of mouth remains the best form of advertisement, so you really are only as good as your last job. The customer isn't always right, but you will need to bite your lip and take a knock on occasion.
Don't work for peanuts for a new client on the promise of 'loads more work in the future' - lots of people will try this, use you cheaply if they can then move on to another mug.
Don't undersell yourself - people do realise that one gets what one pays for in this life and are prepared to pay the proper rate for a job if they know you will di it on time and well.
Reputation is everything - don't slag off others in your trade as this will come back to bite you.
Consider becoming a Limited Company - it works for many, myself included as I pay less tax than I would as a Sole Trader. Your accountant can advise.
Just a few thoughts. Hope this helps! ____________________ Now - Speed Triple, old ratty GS550, GSXR750M
Gone (in order of ownership) - Raleigh Runabout, AP50, KH125, GP125, KH250, CBX550, Z400, CB750FII, 250LC, GS550, ZXR750H1, Guzzi Targa, GSX750F, KH250 x2, Bimota SB6R and counting... |
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winz |
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winz World Chat Champion
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stephen_o Spanner Monkey
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Powderhead |
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Powderhead Trackday Trickster
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Itchy |
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Itchy Super Spammer
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Powderhead |
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Posted: 22:21 - 05 May 2018 Post subject: |
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And perhaps some really obvious basic things:
- Company money belongs to the company. Your money belongs to you. Just because you are a director of the company it doesn't mean the company money is for you to spend on your personal stuff. It doesn't belong to you until you pay it to yourself or give it as dividends from profits and have the correct paper trail.
- Your accountant is not ultimately responsible for your company's finances. YOU ARE! You are the one that has to sign that you agree with his figures. Do everything you can to get to understand your accounts, question your accountant and don't sign anything unless you understand it.
- If you're thinking "can I get away with x...?" use some common sense If it sounds dodgy, it usually is.
- Don't use any tax avoidance scheme.
- Set your corporation tax and VAT aside. Don't be tempted to spend it and top it up later!
And perhaps a less obvious one:
- Pick an accountant who supports Xero. If they don't support Xero, I wouldn't take a discussion with them any further. ____________________ "Now at inspector level!" |
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RhynoCZ |
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BTTD |
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BTTD World Chat Champion
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Itchy |
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Diggs |
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Diggs World Chat Champion
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Posted: 12:37 - 06 May 2018 Post subject: |
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You can run a business without an accountant and it is easy to do as other posters have said. However, accountants are employed to take some of the stress off you and to minimise your tax bill. Go sit down with a few, explain your business model and see what they have to say. Most will say the same thing and it will result in a lower tax bill than if you do it yourself. It does depend upon your anticipated turnover, the structure of the business and whether you want to pay yourself dividends plus a salary, or whether you simply want an annual tax bill with no frills. Ask the accountants to project your likely tax bill given a set scenario, then deduct their fees and see who wins... ____________________ Now - Speed Triple, old ratty GS550, GSXR750M
Gone (in order of ownership) - Raleigh Runabout, AP50, KH125, GP125, KH250, CBX550, Z400, CB750FII, 250LC, GS550, ZXR750H1, Guzzi Targa, GSX750F, KH250 x2, Bimota SB6R and counting... |
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Powderhead |
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jimspeed |
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jimspeed World Chat Champion
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Old Thread Alert!
The last post was made 5 years, 357 days ago. Instead of replying here, would creating a new thread be more useful? |
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