Category: FEU Training Blog

WELCOME to the FEU Training blog. Every month we will focus on subject areas that will help you overcome the challenges of freelance work.

Net gains (2)

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Where to start

If you don't want everybody to know about it, don't put it online. I know that sounds obvious, but it never ceases to amaze me how many people think they can detail their night-time athletics, narcissistic excesses and alcoholic binges on Facebook and then be surprised, and embarrassed, when it’s read back to them.

And please don't try to hide behind privacy settings. They don't work. In any case we are talking about building an online presence, not building an online privacy wall. If you want to keep something private keep it offline. If you want to build an online presence then open up your privacy settings.

So what social media do you need to be on? Let's first look at the mainstream, obvious channels.

Facebook

Facebook can be fun. It's great for keeping in touch with old friends, distant relations and former work colleagues. There is a business network side to Facebook now called BranchOut. For that to work properly people will need to be able to see your basic profile details to know who you are and where you have worked. That also means you must make sure your Facebook profile is updated regularly.

You might also want to consider creating a Facebook page about yourself or a particular aspect of your business. But only do so if you are prepared to update it regularly, probably daily, certainly weekly.

Facebook is an important social medium even if you predominantly use it for social activities. Potential work colleagues like to know what you're up to outside work. Most employers now look at potential workers' Facebook activity. It's fine to be chatty and sociable; it's not fine to be drunk and disorderly.

Twitter

Twitter is a place for 140-character soundbites, a place to seek information, comment and to learn. Some people have more than one Twitter account so they can keep their work and social accounts separate. However, there have been too many errors where people have used the wrong account to make a highly personalised, abusive comment and been caught out.

Generally, Twitter users are keen to hear your work-related tweets and to know a little bit about your personal life and views. A healthy balance works well. So follow other people in your field, important potential clients and useful sources of work-related information, but also follow your favourite celebrities, sportspeople and friends.

Tweet about what you are doing. Let people know what you're doing workwise but don't be boring and only tweet about work. And comment on other people’s tweets, reply to conversations and retweet salient tweets from others.

You never know when one of your tweets will be picked up or you will spot a gem of information in someone else's tweet that could lead to work.

LinkedIn

LinkedIn is the professional social network. This really is the place to make sure your profile contains current examples of your work, details of your recent activities and links to relevant websites.

It is worth spending a little time each week or so looking at your connections and seeking out relevant and useful connections to people with whom you have worked in the past. And when you send them a request to connect, don't just leave the basic text in the box; write something personal about when you worked with them.

It is also worth joining relevant groups on LinkedIn or even setting up your own – a reunion group from a former employer, for example, or an event you attended with a number of other LinkedIn members.

YouTube

YouTube is a place for videos but it is much more than that. If you don't already know, learn how to make a YouTube video. Anyone can put video on YouTube – so why not do it.

Basic video editing software is installed on most computers these days and bog standard cameras that fit on belts or in handbags can take good-quality video. Android and iPhone smartphones have the ability to take YouTube video and upload them to your account instantly.

You can then link your individual YouTube videos to Facebook, Twitter and LinkedIn, as well as embedding the videos in your blog or website.

There is also a comment function on YouTube. Use it. Comment on relevant videos and encourage people to comment on yours. Remember: YouTube is now owned by Google so having a video presence will boost your online ranking.

It’s a start

Get these right, and update your Google profile to include them all, and you will start to build a web presence at zero cost.

Net gains (1)

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Can customers find you on Google?

Here's a test: type your name into Google and press search. Does it find you? Are you on the first page?

If, like me, you have an unusual surname, you are at an advantage here, so let's make it fairer and try a slightly revised test. Type your name and profession – journalist, actor, musician or whatever more specialist job description you like to use – into the Google search bar. Does Google find you? Are you on the first page?

Online presence

Adding a web presence is becoming increasingly important. No matter what we do for a living, we need to make sure the people who might want to buy our services can find us easily online.

There are a whole host of things you can do to boost your web presence. You certainly need your own website, you probably ought to blog, and you need to make sure all your online profiles are up to date and, wherever possible, linked together. That means making sure your LinkedIn, Twitter, Facebook, YouTube, Flickr, WordPress, Blogger and other profiles are up to date and linked together.

Google Profile

Perhaps the first profile you need to update is your Google profile. Google is the most popular search engine so it makes sense to start by getting your profile within its sprawling empire is correct. If you have not already done so, register your Google account and complete your profile. Provide as much detail as you can and make sure you make your profile public.

You will have the opportunity to link your profile to your YouTube, Flickr, LinkedIn and Twitter accounts and many others. You can also add your own blogs and websites. Consider linking direct to pages that are about you or contain your CV. Separately, you can add links to relevant websites. These may be clients or other examples of your work.

All of this means having up-to-date accounts on social media outlets such as LinkedIn, Twitter, Facebook and YouTube. We'll look at all of those next.

Undercover (4)

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Travel and personal accident

You need to think about what could happen to you. Travel insurance is one of the messiest and worst sold types of insurance in the UK. Millions of travellers holiday without it and competition between providers is so fiercely price-based that cover levels have been severely cut back. When the Icelandic volcano ash cloud disrupted air traffic, most insurers said claims were not covered.

But that just means we need to take extra care when buying ravel insurance. First, we need to think about being covered for work trips and not just holidays. If you travel for work you will need to pay extra for those journeys to be included.

Activity holidays

You will need to be clear about what you might be doing on your trips too. We all know that winter sports – skiing and snowboarding – are not covered unless you buy the extra cover, but many other activities are typically excluded or have reduced cover. Very few insurers, for example, will cover you riding a motorbike bigger than 125cc – you’ll need to find an insurer that will if you intend to ride your own bike on your travels or hire a bike while away. Many other activities, such as horse-riding, may be added to standard policies but it may be better to consider a policy specifically aimed at that activity.

If you are going mountain-climbing, or white water rafting, or taking part in any other activity that is likely to put you at risk in an unusual location, it might be best to consider a specialist policy - the claims departments will have access to specialist search and rescue services and have medical teams that understand how to rescue injured people from cliff tops or ravines (your run-of-the-mill medical assistance firm will know how to deal with hotel food poisoning, sunburn and car accidents on motorways).

Day tripper

You also need to consider being covered for day trips – some policies kick in when the travel involves one night’s stay abroad whereas you might fly out for the day and return that evening. There’s no point in having a travel insurance policy that doesn’t cover you for a day trip to Dublin, Paris or Brussels.

And then there’s the need for travel insurance to cover UK travel too. If you book a staycation but need to cancel it due to unforeseen circumstances you’ll need travel insurance to get your money back. But more than that, if you have an accident while away, sure, the NHS will patch you up and put you back together again but the NHS does not have to pay for you to be brought home and treated in your local hospital. Travel insurance would provide a private ambulance, once you were safe to travel, to bring you to a hospital nearer home or your family.

Add all these demands together and you almost certainly won’t be able to buy a standard travel insurance package online or from a direct insurer. You’ll need a broker to find a specialist policy for you.

Accidents never happen (in a perfect world)

Another policy well worth considering is personal accident insurance. Elements of this are often included in a travel policy – if you lose a limb, for example, it pays out a fixed sum. But a standalone policy can have added benefits for freelances: you can buy daily benefits should you be temporarily disabled – if an actor should literally “break a leg”, for example.

You will need to calculate how much income you would need if you were unable to work. This income is not taxed so you only need to cover your after-tax income. The more you need, the more expensive the insurance, but it is much cheaper than you think. The policy will not pay out for the first seven days, normally, though there might be additional exclusions, such as not paying out for 14-days if you had the accident carrying out a dangerous activity. But the policy will pay out for up to two years.

Of course, you could just say it will never happen to you. But having been involved in a car crash that left my wife (another freelance) in hospital for four months and in the care of social services for a further six, I’ve learned my lesson the hard way. I didn’t have personal accident insurance then and was forced to sell my car and nearly lost my house.

We now have a policy that costs about £550 a year and pays out £100 a day for each of us if we’re injured. I calculated that rate on the basis that if one of us were in hospital, the other would be forced to work much less. As it happens, our only claim was when I broke my wrist. I was in plaster for a little over three weeks. The first seven days were not covered but I was paid £1,700 for the 17 days after that until the plaster was removed.

Talk to your broker about the right level of personal accident insurance for you.

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Undercover (3)

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Are you liable?

Could you be sued? It’s a scary prospect – and while we’re not as bad as in the US yet, the country is getting more litigious.

People do look to see if they can sue and parasitic claims management companies are advertising and texting and calling up to see if you have had an accident to try to push you into making a claim (and slicing off a piece for themselves). So you need to make sure you are covered.

PL and PI

In general there are two main kinds of insurance you might need – public liability and professional indemnity. Public liability is straightforward - it is included in most home policies. A professional business package will include public liability for you while you are out working. You will need to make sure any other arrangements you have includes this cover too.

Public liability insurance will pay out if you injure someone while working.  So if you are taking a photo in the street and tumble off your ladder into someone or you drop a juggling ball and someone trips on it, they have the right to sue you for their injuries and possible loss of earnings.

Public liability insurance covers you both for the court costs in defending such actions if they are wrong and the cost of any damages awarded if they were justified.

You don’t have to be doing something out of the ordinary to face a possible public liability claim. If you knock into someone while wearing your business suit between meetings or accidently poke someone in the eye putting up your umbrella in a rain shower, you could be sued. Make sure you have public liability cover.

Professional risks

Professional indemnity covers damage you might cause to clients through your work being inaccurate or not up to standard. Traditionally this was just for the likes of architects, solicitors and accountants – high fee-charging professions, but these days many companies expect all sorts of media and entertainment professional to have PI insurance.

If you do training and teach someone the wrong method to do something, that can lead to a claim. PI policies are now available for a whole gamut of new “professions”, such as landscape gardeners, so many of use need cover. A specialist broker is your best bet or check if there is a scheme running for people in your line of business, perhaps through your union.

Libel and slander

You might also need to consider libel insurance. This would cover court costs and damages if you were sued for libel over something you had published or broadcast. Britain is the libel capital of the world and the advent of no-win, no-fee lawyers prepared to take libel cases for free means many more low-value cases (still close to £100,000 settlements) are happening.

Libel insurance can be expensive – the insurers will want to know what you do, for whom you write or produce films, audio or broadcasts and lots more detail besides. Again either use a specialist broker or check if your union has a scheme lined up already – the NUJ has one for its members.

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Keeping your kit covered

Many freelance creatives have a lot of expensive kit they need insured. This could be laptops, recording equipment and cameras; it could be artists’ materials, props and costumes; or it could be musical instruments or a DJ’s record collection. You may even have a specialist piece or kit for your particular job or act – a unicycle or a puppet theatre, for example.

If losing or damaging these would cripple your finances you must make sure they are adequately insured and will be replaced immediately. You may even need to make sure you can hire an alternative in the short term while you source a replacement.

Find a broker

If you have these sorts of needs you almost certainly need to find an insurance broker to whom you can explain your specific circumstances. Comparison websites and even specialist online business broking services can only currently cope with packaged products with limited add-ons.

Certain brokers will have specialist schemes for different sorts of professionals. David Rogerson of broker Towergate runs a scheme called Camerasure for professional photographers and videographers. The policy is underwritten by Aviva, one of the largest insurers in the country.

This sort of policy not only covers replacing your kit whether it was lost or stolen or accidentally damaged but provides rented kit in the short term and will compensate for any work lost while you are unable to work. It has a range of business covers included that would be useful for a full-time professional.

 Bells and whistles

You’d expect Rogerson to be pushing his “bells and whistles” policy hard but he understands that not every photographer has the same investment in kit or the same income from their work. “Camerasure is for the full pro,” he says. "If you are an amateur who earns a bit and you only have about £5,000 of kit, it might be possible to add that camera kit to your home contents policy. You might also be able to do that even if you are semi-professional.”

Rogerson points out that this sort of compromise might be available to other pieces of kit, including musical instruments. But if you are a full professional using your kit for work every day then a specific business-use policy is likely to be vital.

The cheap solutions are always inferior and you need to understand that when balancing price versus cover. Cheap solutions will have more exclusions and more restrictive warranties – there’s a word to watch for in insurance policies.

 Warranties

We think of a warranty as something that guarantees to repair our newly purchased products should anything go wrong – and it is. But in insurance jargon it has a second, more negative, meaning. A warranty is a restriction the insurer puts in place and you, the insured, must adhere to it for the policy to pay out. This might be that you must lock kit in the boot of a car and not have it on the back seat, for example.

Whichever policy you get always make sure you are clear on any restrictions in place and understand what is and is not covered. A broker might be able to get a particular warranty lifted for you if it is important to you, but this will almost certainly be at a cost.

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Home and car

Insurance is what accountants think is dull. But it is vital that freelance creatives get their insurance right. Even the basics of car and home insurance need to be considered.

Iggy Pop famously caused a stink when he started advertising Swiftcover and other musicians discovered that Swiftcover would not cover them. The firm backtracked very fast once the issue hit the headlines. But the example shows why those of us freelancing in the entertainment and media fields need to be very careful to ensure we re covered.

Utmost good faith

There’s no point in lying about what you do. Insurance is based on a principle called “utmost good faith” and lying is not part of that. If you lie, an insurer is entitled to refuse your claim and simply refund you your premium, leaving you uninsured.

For most creative freelances that means using an insurance broker who knows which insurers will happily cover us or who has strong personal relationships with underwriters (the people at insurance companies who decide which risks to cover).

One of the biggest risks is called third-party liability. If you are doing a job and it might involve giving a big-name celebrity a lift in your car or having them round for dinner, you face a huge third-party liability risk. If Elton John has to cancel his world tour because he got whiplash in your car when you ran into the back of someone, your insurance company will have to pay out for the whole cost of the cancelled tour.

So if you are never going to have the likes of Elton John in your car (or home) you need to explain that to your broker, who will explain that to the underwriter, who will then come up with a decent price.

The car’s the star

Most motor policies cover you only for personal use – called social, domestic and pleasure (SDP). Some will include commuting but only to a single fixed place of work. If you need to use your car to go anywhere other than that – and we freelances tend to have lots of other places we need to drive – you need to have business use added on. Technically this is free but insurers generally offer a discount for SDP-only policies, so you will see the premium rise if you want to add business use.

Similarly, you need to let your insurer know if you work from home. There are specialist home/office policies for those running a proper business with staff and equipment from home, but many home insurers can be nudged into adding business use onto their policies at little or no extra cost. But you must tell them

Honesty is the best policy

Telling an insurer all this information often involves more than filling out an online form from one of the price comparison sites. Also, a broker has a professional duty to get you appropriate insurance. They will ask you questions to see if you are risk-adverse or risk-seeking and recommend policies that suit while pointing out any exclusions that help keep the price down – if you store your equipment in an office normally don’t expect it to be covered if you bring it home and it gets stolen or damaged.

There comes a point when it makes more sense to switch to a professional policy for your specific needs – camera cover or a specialist musical instrument policy, for example. But it depends on each individual’s circumstances. Many freelances just need to be open and honest about their work and their insurance needs. A broker will then be able to find the best deal.

David Rogerson of broker Towergate said: “It’s a misunderstanding that if you are in the entertainment trades it will cost you.”

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Towergate

The taxman cometh (5)

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Choosing your accounts software

To err is human, but to really foul things up requires a computer - you’ll remember that adage if you are of a certain age. But the reality is that these days we all need to do our accounts on a computer. That means choosing what software to use.

The first thing is to check with your accountant what they are used to working with and what they recommend. You want to be able to hand your accounts over electronically, either on a disc or by email.

 Simple or complex?

You also need to bear in mind how complex your accounts are likely to be. Most lone freelances with basic income and expenditure accounts can probably manage with just inputting the numbers into a spreadsheet under the right headings. That probably simply means Microsoft Excel or something similar – that comes as part of the Microsoft Office suite.

You might prefer something that can handle more complex data – certainly worth it if you are planning to be busier and expand into new ventures or operate as a company. You might need to buy an accounts package, such as Quickbooks or even Sage.

Many accountants are happy to receive files in these formats. Sage is the sort of package big businesses use – and can manage payroll, for example – though small business versions are available. But Sage is far from intuitive – I find it almost impossible to understand – so only go down these routes if you are prepared to devote time to learning the intricacies of the software or ready to pay someone to do your book-keeping for you.

 Online solutions

The other option is to look at online book-keeping packages. Many accountants will now accept accounts in some of the formats available. The advantage of these is that they are free, or cheap, and you can update your accounts from any computer rather than having to be at the computer with your software loaded.

The downside is that they are often limited and you hear reports of them failing and data being lost. Having paid nothing or next to nothing, there’s no recourse if you need to complain. Check your accountant’s experience of the online services and follow their advice.

The taxman cometh (4)

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Choosing your accountant

Choosing the right accountant for you and your business is crucial. You need to be able to trust your accountant to do the best for you, to give you accurate advice and to present your affairs in an honest and accurate manner to the taxman.

Get it wrong and you may face the wrath of HMRC and full-blown investigation into your affairs, in which you will be expected to produce all your records going back years and you may be expected to justify each and every item of spending.

My first recommendation is that you choose professionally qualified and regulated accountant. In effect that either means an ACCA-qualified accountant or, more likely, an ICAEW-qualified accountant. ACCA and ICAEW are accountancy institutes that not only set qualification standards but regulate their members. ACCA members are generally called certified accountants and ICAEW members are called chartered accountants.

"It's fun to charter an accountant.....and sail the wide accountancy" - Monty Python

Be warned: anyone can call themselves an accountant. Many are not qualified or only partially qualified. Only regulated firms come with any official guarantee and back-up – they must carry professional indemnity insurance, for example, to cover any errors or omissions they make.

It has been known for an accountant with a large entertainment-based clientele to come unstuck with the Revenue and have certain expenses challenged. This results in HMRC investigating every single client and demanding back payments of tax for exaggerated expenses claimed.

Why a chartered accountant?

Michael Izza, chief executive of the ICAEW, said: “When hiring an expert for any job, a client wants to know they are buying expertise based on quality, honesty and efficiency. It is also vital that the ‘expert’ is suitably qualified, has undergone the correct training and is subject to some kind of regulation to ensure a high quality of service.  This is true of doctors, teachers and lawyers, and ought to be for accountants too.

“Chartered accountants have all these qualities, and we want people to know that even in their day-to-day life our members can be an invaluable help in saving you money. You can definitely count on a chartered accountant.”

Before becoming a chartered accountant and using the designatory letters ACA or FCA, ICAEW members must:

  • undertake a period of at least three years’ training with an organisation that is authorised by the ICAEW
  • pass exams covering financial management, auditing, business strategy, taxation and IT
  • undertake a programme of Continuing Professional Development, which demonstrates their commitment to high standards.

The ICAEW said it also ensures that chartered accountants develop communication skills, business awareness and professional judgement.

Finding an accountant

To find a chartered accountant, the ICAEW provides a search function on its website (new window), which will list firms by name or location and by their specialist area.

But try to find one that others in your field use. They will know the rules governing your sector and have a good idea of what others like you have successfully claimed as legitimate expenses.

You may also want to think about whether or not you have ambitions to be more successful in the future. Some accountants handle thousands of similar clients sausage factory style – and that may be ideal as it keeps costs low.

But if you hope to be more successful and have a growing income, consider a slightly bigger accountancy practice with a broader range of skills and experience. It will be able to grow with you and provide new, different advice and accounting support as your circumstances change.

And spare a thought for the chartered accountant who really wants to be a lion tamer.

The taxman cometh (3)

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Get an accountant

Every creative freelance should hire an accountant to do their accounts and file their tax returns.

Many freelances refuse to pay an accountant, preferring instead to struggle through their self-assessment form themselves. Well good luck to you, if that’s you.

That’s exactly what the government wants you to do because it knows you will not be deducting all the costs and making use of all the allowances that you could have used. You will be paying more tax than you should have done and Chancellor George Osborne will be delighted.

I’m good a maths. I understand numbers better than most journalists (many of us think of ourselves as wordsmiths first and foremost). I’ve worked on several financial and accountancy magazines and websites. I’ve interviewed chancellors of the Exchequer, accounting standards setters and bigwigs in Her Majesty’s Revenue and Customs. But I pay an accountant to go through my books and put everything in order.

Pay for professionals

Actors hate it when non-Equity extras get used, when the am-dram queens think they’re as good as drama-school trained professionals. Journalists get riled when teachers get the job of covering sports matches or students get to write gig reviews, just because they’ll do it for the free entry ticket rather than charge a proper fee. We’ve all seen the well-meaning amateur make a hopeless hash of a job we could have done to a professional standard.

Well, it’s the same with accountancy. Being good at maths doesn’t make me an accountant.

An accountant will be able to do your accounts faster and more accurately. They will know the tax allowances that benefit you. They will know what expenses you can legitimately offset against your income and those you cannot. And they will know where to find answers to questions much faster than you can.

 Knowing the market

If you use an accountant who knows your sector and has other clients in similar lines of business they will know the specific schemes that operate in your sector – film and TV have their own rules, for example - and what others in your field have successfully claimed or unsuccessfully tried to claim.

And there is an additional benefit of using a professional accountant: should the taxman investigate and discover your accountant has got things wrong, you can sue your accountant – those regulated by their professional bodies are required to have professional indemnity insurance to cover just such an error.

Next: How to choose your accountant.