Setting up as a freelance graphic designer can be intimidating at first, buying the right freelance insurance, deciding what to charge for your work, and registering with HMRC once you start taking income. There are lots of things to think about before you get started to ensure you’re well protected and legit. Here we’ll explain what you need to know.
Insurance for freelance designers
Being a freelance graphic designer means you’re exposed to more risks than if you were employed. You could have your essential equipment stolen, meaning you can’t work, or even face legal action from a client.
Legal defence can be very expensive, and replacing equipment isn’t cheap either. Taking the time to look over your options could be one of the best business decisions you ever make. So, what are the popular types of freelance insurance UK?
Freelance professional indemnity insurance
Professional indemnity insurance protects graphic designers in case a client accuses you of faults in your work that led to financial loss. For example, you may design something which contains errors or infringes on copyright. You could even accidentally forward an email that contains a virus.
In these cases, professional indemnity insurance could help cover the cost of any legal bills if you have to defend yourself, as well as cover any compensation.
Freelance public liability insurance
Public liability insurance is very important if you physically deal with members of the public, such as customers or clients. With this insurance, you could be protected should you be sued by someone claiming an injury or accidental damage.
Even if you work remotely, if a client visits your home office and trips over some work equipment, they could sue for an injury. With insurance in place, your legal expenses could be covered to defend yourself, as well as any compensation claim.
Contents insurance is essential for freelance graphic designers, as it protects your work equipment from theft, accidental damage, or loss. You probably have a high specification laptop or another device, along with other equipment you rely on to do your job.
Each policy is different for what it covers, but contents insurance gets you back up and running by funding a replacement if you do face one of the covered events.
Do I need business insurance?
The only insurance you ‘need’ by law is employers’ liability insurance. If the business is going well and you employ other workers – even on a temporary or casual basis – you legally need employers’ liability insurance.
Employers’ liability insurance will protect you if current or former employees are injured or become ill in the line of work. If they choose to sue you, the policy could cover your legal fees and any compensation. As it’s a legal requirement, there are fines of up to £2,500 per day for not having insurance in place.
How to register as a self-employed HMRC
If you’re a freelancer and earn more than £1,000 in a single tax year, you need to register as self-employed – also known as a ‘sole trader’. Double-check with HMRC’s Employment Status Checker to confirm your employment status.
You will need to register with HMRC by October after the end of the tax year that you begin taking income. For example, if you began freelancing in March 2021, you would need to be registered with HMRC by 2021. Remember that the tax year runs from 6th April to 5th April.
To pay your tax and National Insurance, you need to submit a Self Assessment form. If you’re confused, there’s plenty of information out there on paying tax and National Insurance as a freelancer.
How much should I charge as a freelance graphic designer?
It can be difficult to decide how much to charge as a graphic designer. Generally, two things will affect how much you charge: your experience and the project’s complexity. It would help if you also considered your outgoings, like the cost of equipment, insurance, as well as tax and National Insurance deductions.
The most common charging structures are hourly or project-based. Hourly means you charge for each hour a project takes to complete. While this depends, a beginner designer could realistically expect to charge around £10-£13 per hour. More advanced designers could charge in the region of £30-40 per hour or more.
Another way to charge is a flat fee for completing the entire project, which will be more appropriate for advanced designers. Of course, this is highly subjective as it depends on your experience level and how complex the project is.
Build a website
When selling yourself to potential clients, your portfolio is an important part of your online presence. It’s where you promote your work to help draw new clients in.
When deciding what to include, stick to your best work. If you’re experienced and already have a long-standing career, it may be easy to pick out some memorable pieces.
But if you’re new, you may only be able to present a few pieces you’re proud of. Don’t let that put you off, though. Include what you have, and feel free to include work you weren’t paid for, like projects you’ve completed in your free time.