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The transition from being an employee to running your own business is a liberating one, but it comes along with some additional responsibilities. Whether you're new to the business or an old hand, here is a quick overview of being self-employed. 

1. Self-employed individuals are technically running a business that shares the same legal name as they do, this is also known as a sole trader. If you had incorporated your business by registering with Companies House, your business would be known as a limited company which comes with different responsibilities.
2. The Self Employed must register with HMRC and complete a yearly self-assessment. There are penalties for failing to do so and it's a simple process, so there's no reason to delay registering.
3. If you have a turnover of less than the VAT registration threshold, you can file a short self-assessment instead of the long self-assessment.
4. Self-employed individuals pay income tax on their net profits, as well as Class Four National Insurance on profits and Class 2 National Insurance at a fixed weekly rate, although these rates are subject to change.
5. You can use the 'simplified expenses' rule for premises and vehicle costs in order to make record-keeping as simple as possible.
6. As a self-employed individual, you can use your personal bank account for all business matters, however HMRC may ask to see all these records. If you wish to keep your personal expenditures private, it may be worth maintaining an account just for business matters.
7. You do not pay yourself a salary, but take profits from the business in the form of 'drawings'.
8. You pay tax on all profits, regardless of whether or not you have withdrawn them.
9. HMRC will not request a full breakdown of your accounting if you are below the VAT registration threshold. You will only need to declare your income from self-employment and your business costs, making record-keeping much simpler. However, it is still a good idea to maintain careful records to help you highlight areas for improvement.
10. The Making Tax Digital initiative has been adjusted to exempt self-employed individuals who are not registered for VAT and have turnover below the required VAT registration threshold.

  Note: all self-employed people are technically running a business. In any business matter, it's always a good idea to have expert financial assistance from an accountant. This article is for informational purposes only and does not constitute official tax advice.