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5 Things to Consider when Setting Up as a Lone Tradesperson

If you’ve got the knowledge and skills to be a tradesperson, you may decide it’s time to go it alone and set up your own business instead of working for someone else.

But before you do, there are some things you should consider first, including your legal requirements:

1. Qualifications and experience

If you’re ready to start a business as a tradesperson, the chances are you already have the relevant skills and knowledge to carry out jobs correctly. Experience is the most valuable way of learning, so if you’re starting out as a newbie, you’ll need to dedicate time to build up your expertise. It’s always best to work as an apprentice for another firm first before starting out on your own.

The area you decide to specialise in will determine the exact qualifications you need to do the job. There are hundreds of courses available and the more qualified you are, the better your chances of getting work.

2. Health and safety

It is paramount that you understand the basics of health and safety in order to protect yourself and the people around you from dangerous situations as a result of your work.

The law regarding health and safety on construction sites states that construction companies and self-employed tradespeople have to establish and manage hazards and comply with regulation. Tradespeople must carry out risk assessments before and during the work they do, establish any risks and act accordingly to minimise those risks.

If the Health and Safety Executive decides to carry out an inspection on your site and you have not taken the relevant precautions to prevent risks, you could be fined or even prosecuted. You can familiarise yourself with health and safety law here.

3. Registering your business

Before you can start taking on jobs, you’ll need to register your business, either as a sole trader or limited company. This is done by informing HMRC and registering your business with Companies House if you decide to be a limited company.

Many tradespeople prefer to set up as a sole trader as it means less administration needs to be done to manage tax. However, as a sole trader you are personally responsible for the finances of the business. Essentially you are the business. You can still employ staff as a sole trader.

Setting up as a limited company means the company is legally separate from you and the business finances are kept separate to your personal finances. Both sole traders and limited companies keep all profits after paying tax.

4. Managing accounts

Managing your accounts and paying your tax correctly is vital for your business to succeed. Whilst not legally required as a sole trader, it’s a good idea to set up a business bank account in order to keep on top of your business expenses and income. As a limited company, you must set up a separate business bank account.

Both sole traders and limited companies have to keep proof of all income and expenses and are legally required to file an annual tax return.

Hiring a bookkeeper or accountant is the best way to stay on top of your business finances as submitting your accounts late or incorrectly can result in a fine.

5. Insurance

The construction industry is a high-risk industry, so before you take on any work, you should seriously consider having the right insurance policies in place. This means that should an accident, injury or death happen as a result of your work and a claim is made against you, you will be covered by your insurance policy. Without insurance, you will be responsible for paying compensation costs and legal fees associated with a claim.

If you are employing staff in the UK, it is a legal requirement to have employers’ liability insurance.

There are many policies available for tradespeople and you should seek out the one that is best for you and your business. The most common policies worth considering are:

  • Public Liability – you must have this to become a Quotatis pro
  • Van
  • Contractors All Risk
  • Employers liability

Find out more about insurance for tradespeople here.


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Emily Rivers

Emily Rivers is the Customer Experience Manager at Quotatis. She informs customers of the latest developments in a range of products so they can make the best choice for their homes and ensures they get the best out of our service.

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