Here's how you can monetise your side hustle
Have any of your friends set up an Etsy store in the last year?
Or maybe you had more time to build up a side hustle and turn it into something more.
With much of nation having experienced furlough or redundancy at some point over the last year, some have plugged away at their passion projects to bolster their income – and you could do it too.
A side hustle might lead to an entire career change, or it could just be a way to inject more into your finances.
Marieke Flament, CEO of Mettle (a small business specific account by NatWest), tells Metro.co.uk: ‘There has been a small business boom over the past year, with Companies House data showing that new business formations increased by 230% in the first week of January 2021 compared to the same period the year prior.’
Recent research from Mettle and YouGov looked into the reasons people were seeking their own business ventures.
They identified that 57% of people wanted increased flexibility and 38% wanted to change their work-life balance, which as a trend is likely to continue as businesses shake up how they work going forward.
It was also found that side hustlers are expected to contribute an estimated £125 billion to the UK’s economic recovery this year.
‘Monetising something may sound daunting, but it is often a very simple process,’ Marieke says.
If you want to start earning from the thing you love doing, these are the first things you need to consider, no matter what your business.
Decide how you’re selling and promoting your business
Depending on your business, it’s important to figure out where the best place to sell is.
It might be through social media, a website or in-person.
‘If your business operates mainly offline, it would be worth exploring markets, fairs, festivals, and sector-specific events you can attend, sell and promote at. This will not only raise your profile but also introduce you to new, local customers,’ Marieke suggests.
She adds: ‘Independent retailers should also ensure they have the digital infrastructure in place to support consumer demand for safer and more convenient payment methods.
‘Ensure everything is kept up to date with detailed information on what you are offering, high-quality images, and contact details for any questions potential customers may have – no stone should be left unturned.’
Open a business banking account
Marieke says that people often start by using their personal bank accounts, but that it’s worth getting a dedicated business account instead for the side hustle.
‘A common oversight is to use your personal banking account, but this will likely mean you’ll run into issues further down the line when it comes to paying tax, sending or receiving invoices, or forecasting,’ she explains.
Explore registering your business
‘While side hustlers and sole traders are not required to, if you want to operate as a company, you’ll need to register with Companies House.
‘This allows you to own the rights to your company name and can help further down the line when it comes to expanding your enterprise and exploring hiring additional staff members,’ Marieke explains.
Once you’ve done this, you’ll receive a Certificate of Incorporation, company number and date of formation – the latter two are required for tax returns.
You can remain as a sole trader, which excludes you from paying corporation tax. You’d only need to pay income tax and National Insurance contributions on profits.
Ensure your business is fully tax compliant
You don’t want to risk being hit with a fine or unexpected bill later.
‘It may be low on your initial priority list, but for any new business being tax compliant is crucial and it’ll mean that you’re paying the exact amount of tax required.
‘This means that you’ll easily be able to know what your end-of-year profits are, and what can be reinvested into your business to help it grow further,’ Marieke says.
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