Legal Checklist - six things you must consider when going freelance

Freelancers need all the advice they can get when it comes to legislation – not knowing your liabilities can be a painful and costly lesson if you have to learn them the hard way.

Six things you need to know (but might be afraid to ask your lawyer)

Deciding to break out on your own and go freelance (whether by choice or by circumstance) is an empowering but nerve-wracking target. There’s a lot to consider before you start out, including your legal responsibilities. Here are some key points to bear in mind:

Read on for six key areas you need to consider…

Contracts

“We don’t have anything in writing, so is there a contract?” It’s a common question among new freelancers.

Where there’s an agreement for money to be paid and goods or services to be provided, there’s very likely to be an enforceable contract, whether it’s in writing or not. The advantage of written agreements is that terms can be made clear up from the get-go, and the parties can agree what is or isn’t implied in the contract. Email counts as writing, don’t forget, so when you’re next agreeing an engagement over the phone, the best thing to do is send an email confirming your understanding of what you think you’ve been asked to do and the price agreed for doing it.

Find out more in our “eight clauses your freelance contract shouldn’t be without” article.

Structure

Are you going to be a sole trader or a limited company? The industry you’re in may dictate this for you. There’s nothing to stop starting as a sole trader, seeing how it goes and then, when you’ve found your feet, incorporate. If you’re new to this freelancer thing, baby steps could well be the best way forward.

Professional Bodies

Check whether your professional body memberships are up to date and permit to you to carry on your chosen profession or trade. It may be that you have to re-register in your own right where previously your employer took care of this for you.

Insurance

Even if you’re working from home, it’s worth considering office and public liability insurance in case something happens when you’re on the road or someone comes to visit. Your home insurance won’t always cover you. Find out more about small business insurance with our free business insurance guide.

Data Protection

Are you going to keep any individuals’ personal information on your systems, e.g. customers or suppliers names and addresses? If so, you’ll probably have to obtain a licence from the Information Commissioner. At £35 a year, it’s a small price to pay. The consequences of not having one when you should can be expensive. If you’re unsure whether this applies to you, you can check the Information Commissioner’s Office website for details. Since May 2018, you also need to make sure you think about GDPR and how you gather and manage any data that you collect. Our ‘What is GDPR’ article can help you with hints and tips.

Website

Even if you only have an e-brochure site rather than a huge e-commerce beast, it’ll still have to comply with minimum rules regarding accessibility for those with disabilities. Your website will still have to comply with minimum rules regarding disability access. Your pages should have text-only versions so they can be read by text converters. You should also establish privacy policies so that users know where they stand, and to limit your own liability. We’ve got a great article on how to build a website for your small business if you need more ideas.

In short, your particular sector will dictate what compliance and legal issues will take precedence for you. From experience, keeping things simple to start with can make life a lot easier. Make sure you’ve checked the necessary clearances and licenses before you go public with your new freelancer lifestyle.

Above all else, don’t let compliance and legal issues prevent you from taking that leap of faith and making a fresh start for yourself as a freelancer.