Self Employed Loans: Finance For Freelance Business Owners

Everything You Need To Know:

Self-employment Overview

Setting Up As Self Employed

Self Employed Loans UK

Self Employed Finance

Self Employed Loans FAQs

Frequently Asked Questions

Self-employment Overview Setting Up As Self Employed

Self-employment has witnessed rapid growth over the past few years, the rise of this sector of employment has been seen across all regions in the UK. Research from the Office for National Statistics reveals that the number of self employed people has grown from 3.3 million in 2001 to 4.8 million in 2017 – and this figure continues to grow! There are so many reasons to become your own boss and go self employed, why wait?

Being self employed means that you work for yourself, rather than an employer. Working for yourself, you can fall under three categories:

Setting up as a sole trader
Becoming a partner in a business partnership
Setting up your own limited company

All three of these routes provide several advantages in business. Self employed people tend to have far more flexibility with when, where and how they work, which means it becomes easier to balance personal commitments such as childcare. Not only this, you get to take greater control of work whilst exploring your entrepreneurial side. Depending on how you work yourself there’s no need to report back to anyone and earning potential is often far higher. What’s more, when calculating tax liabilities, you may be able to deduct certain costs with HMRC.

Self Employed Sole Trader

If your plan is to go self employed as a sole trader, you will need to register with HMRC beforehand. There are lots of factors to take into consideration when doing this, which we cover in our sole trader informative guide.

Self Employed Limited Company Owner

Limited companies have a different business structure to sole traders. Again you will need to register your business with Companies House to receive a ‘certificate of incorporation’ confirming that your company legally exists. After signing up you will be automatically registered to pay corporation tax.

Self Employed Business Partner

Partnerships exist if two or more people want to go into business together but aren’t looking to set up a limited company. In many ways, a business partnership operates similarly to a sole trader business. You will be required to submit annual self-assessment forms to HMRC but are free from a lot of the accounting responsibilities limited companies are required to provide. As a partnership, all partners are responsible for any business losses and paying tax on their share of the profits. When setting up a self employed business partnership, you will also need to register with HRMC.

How Much Tax Do You Pay If You Are Self Employed?

The amount of tax you’ll pay when you become self employed will depend on:

How much money you make
The allowable expenses incurred whilst trading

Business-related expenses can often be deducted from your self employed income when calculating your taxable profit. These tax bands are the same for employed and self employed people.

Allowable expenses include business insurance, office costs, commuting costs, utility bills and stock, but make sure you thoroughly read through Gov.uk to ensure you get the expenses right.

Self Employed Loans UK Self Employed Finance

Self employed loans provide finance for people running their own business, operating as a sole trader, limited company owner of partner of a business partnership. By working for yourself, you get to decide what business purposes to use the loaned funds for. Self employed people don’t always find it easy obtaining finance, they can often be perceived as ‘higher risk’ in the eyes of lenders.

At SME Loans, we help all self employed people secure the finance they need to continue to succeed….

Self Employed Business Loans

As a self employed business owner we can help you access unsecured business loans. We offer unsecured finance from £1,000 to £500,000. Being self employed you might not have business assets that you are able to give up, which is why our unsecured self employed loans are the perfect solution! There’s no need to offer business or personal collateral to secure the loan against - instead it’s likely you’ll be asked to provide a personal guarantee.

A personal guarantee is a legally binding agreement stating that if your self employed business, limited company or business partnership defaults on loan repayments, you as the business owner become personally liable for paying back the money in full.

Our flexible repayment periods mean you can pay back the loan over a period of 1 to 5 years, and as we offer competitive rates, interest will always be at a low.

The Merchant Cash Advance

Our merchant cash advance product can also benefit self employed business owners, providing their business takes sales through a card terminal. With a merchant cash advance, you can receive an advance on the revenue your self employed business is predicted to make through future debit and credit card sales.

At SME Loans we offer funding between £5,000 and £500,000 which gets repaid using a small percentage of future customer transactions. With this product the lender will work with your card terminal processor to set up automatic withdrawals of the pre-agreed percentage of sales. The best part is, your cash sales won’t be affected in the slightest!

Loans For Self Employed With Bad Credit

Business owners with bad credit are often discouraged from seeking finance from lenders. At SME Loans we’re working hard to change this – there’s no need for your business dreams to be put on hold because of past financial faux pas. If you have bad credit we will look largely at your business performance and you could still be eligible for a self employed loan. For more information on accessing finance with bad credit take a read of our guide.

We’ve helped several self employed individuals from a variety of sectors obtain finance, find out if you’re eligible to apply:

You need to be registered in the UK with HMRC
You should have been actively trading for 6 months minimum
Your monthly turnover or card sales should equate to £5,000 minimum
You, the self employed business owner are over the age of 18

If you have any questions regarding our application form, qualifying criteria or anything else, please do give us a call on 020 3475 9213 - we’re always more than happy to help!

Step 1:

Once you click to apply you will be redirected to a new page where we will ask for more information about your business, including:

Its name
The number of months or years trading
Monthly turnover
The amount you want to borrow

Step 2:

Once you’ve told us a bit more about your business, please expect to disclose your personal details: including your full name, position in the business and contact details.

Step 3:

It’s really important that you read through the terms and conditions before clicking to accept and receive your quote. After you’ve read through the terms, your application will be reviewed without delay by one of our approved business finance suppliers – their job is to find the best lender for your self employed business.

Step 4:

Please expect a call from one of our trusted account managers to discuss the terms of your loan or cash advance agreement.

Step 5:

Take time to read fully through the terms of agreement, asking any questions you are unsure of before signing the relevant documentation and returning it to the lender. After that the money will be deposited in your account in as little as 24 hours.

Don't delay, apply today!

Self Employed Loans FAQs Frequently Asked Questions

If you still have questions about self employed loan, then make sure to checkout our FAQs below for some more answers.

What are self employed loans?

A self employed loan is a form of financing specifically designed for self employed workers, freelancers and business owners. Self employed loans are generally unsecured against an asset, but can be secured against valuable property if requested. They can also come in the form of a merchant cash advance or a limited company loan.

How can I get a self employed loan?

You can get a self employed loan by completing an online application. As a business owner you will be required to provide some basic information about the business, such as your monthly turnover. You will also be required to input some personal details and contact details. If your application is successful, an account manager will then be in touch to discuss the term of your loan deal and to answer any questions you may have.

Why choose SME Loans for a self employed loan?

At SME Loans we have worked with many different self employed businesses so we understand the difficulties that your business might face. That’s why we work with a dedicated group of regulated lenders who can offer competitive rates to help your business thrive and grow. Our brokers are at hand to talk you through your application and loan options and are more than happy to answer any questions you may have.

Self Employed Loans up to £500k

Fast Funding For Self Employed Business Owners

Access £1,000 - £500,000 in just 24 hours