The FreeAgent Blog

Improved Guess for transactions

Posted on 13 December 2017 by Roan Lavery - Jump to comments

Our transaction guessing robot

It’s surely only a matter of time before robots take over the world and humanity is ultimately enslaved to a race of mechanical overlords. In the meantime though, let’s enjoy those little productivity gains that automation can bring us!

For instance, take our popular Guess functionality that cleverly explains your bank transactions when you import them into FreeAgent. We’ve just updated this to be even smarter than ever, saving you time in explaining your bank statements.

Guess will now attempt to automatically explain transactions that match open invoices and bills. If FreeAgent detects an open invoice or bill for the same amount as the incoming transaction, and if it’s dated around the same time, the invoice or bill will be marked as paid and the transaction will be explained automatically.

If you’ve never used Guess before then take a look at our help articles to understand how to switch it on and how it works in detail.

We’ve got more automation features coming in the new year to speed up your statement wrangling even further, so that’s something to look forward to while we inch ourselves ever closer to the Matrix.

Don't have nightmares,
Roan and the humans at FreeAgent

Commercial savvy: what small businesses can learn from this year’s Christmas ads

Posted on 6 December 2017 by Fiona Hendrie - Jump to comments

Season’s greetings! The ad breaks are packed with festive promotions at the moment, but are there any business tips hidden amongst the tinsel?

We’ve given a few favourites from this year’s Christmas ads some thought to see what can be learnt from them. So grab a blanket and some spiced tea (or mulled wine, if it’s that time of day) and let’s get watching...

Perseverance pays off 🎄

Arguably this year’s most charming ad, the Heathrow bears keep stealing glances at each other at the airport. After lots of shyness and missed opportunities, they eventually forge a connection over some duty free shortbread. Their perseverance (and willingness to keep buying shortbread) pays off - and we finally see them grow older together, along with their blossoming family of well dressed little bears.

Small businesses can definitely stand to take a leaf out of the bears’ books - a determined mindset pays off when it comes to business relationships. Make a decided effort to stay in touch with your clientbase, as well as putting in ample time with prospective clients too. If you decide to go the extra mile and give them a Christmas gift, check out our guide to claiming tax relief on Christmas expenses.

Know when to take a break 🎁

This whimsical ad by John Lewis shows a young boy becoming great friends with a monster called Moz living under his bed. They start to play together all night, every night - until the boy starts to lose out on sleep and becomes tired all the time. Moz feels guilty for wearing out his new pal, and hides a snow globe nightlight under the Christmas tree, allowing the little boy to sleep soundly whenever he turns it on, and play with Moz again whenever he turns it off.

As a small business owner it can be easy to work long hours and wear yourself out, especially when deadlines are looming. Make sure you have your own ‘night light’ (or at least give yourself a break before you start snoozing at your desk) by checking out our tips on weaving small breaks into your working day or taking a full on digital detox.

Protect yourself 🎅🏼

Paddington Bear is back and he’s pitching in to help Marks & Spencer with their Christmas creative. Mistaking a white-bearded robber for Santa Claus, the kindly old bear helps the robber ‘deliver’ some stolen parcels back to their rightful owners. Touched by Paddington’s kind gesture, the burglar tearfully wishes him farewell, sensing the error of his ways.

As well as pointing out the obvious downsides to a life of crime, this ad can teach small businesses the importance of watching out for untrustworthy characters. Help to protect yourself from any potential late payers by building T & Cs into your invoices, and if you do encounter any problems, find out the lowdown on taking legal action against clients who just won’t pay.

Make your own community! 🎁

Not known for having the most memorable of Christmas ads, Waitrose have made a surprisingly decent effort this year. Some festive revellers enjoying a Christmas Eve beverage in their local pub get snowed in and have to make Christmas dinner together - starting off as strangers and becoming firm friends.

Freelancers can sometimes find themselves having a comparatively isolated work life, without the hubbub of an office to work from every day. For this reason, it’s a great idea to make the effort to find other freelancers in your community - whether through going to local meetups like Creative Mornings or joining an online community like Freelance Heroes.

Staying on top when you’re under the weather: tips for small business owners

Posted on 4 December 2017 by Victoria Shepherd - Jump to comments

One of the downsides of being self-employed has always been the lack of traditional benefits. As the number of self-employed people in the UK grows (4.5 million in 2015, up from from 3.8 million in 2008) so does the pool of people who are vulnerable to unexpected changes in their circumstances.

We recently carried out a survey of over 500 UK micro-business owners and found that a huge 82% of micro-business owners have worked through an illness because they felt they couldn’t afford to take time off.

To reduce the danger of cash worries due to being under the weather, here are some practical ways to help protect yourself:

Build in a buffer

Everyone has some downtime eventually, so it’s important that the rate you charge contains a decent buffer. You can set aside this extra money as your own personal insurance policy, whether it be for illness, maternity/paternity cover or even just downtime between jobs.

The Association of Independent Professionals and the Self-Employed (IPSE) recommends that you take the salary that you would earn as an employee in a similar role and add a third, which accounts for the added costs that being a freelancer can entail.

So if you earned £30,000 as an employee in a similar role, then adding on a third of this takes you up to £40,000. You can then divide £40,000 by the number of days you would expect to work in a year. This should give you an idea of a ideal minimum day rate.

There’s more information on calculating a rate that covers you for the unexpected in Business basics: how to price your freelance work.

Consider getting covered for recovery

Insurance products like an income protection policy could offer you some cover, which would ensure you continue to receive a regular income until you’re able to return to work. How much you pay into the scheme each month will depend on the policy and your circumstances. Usually income protection insurance covers a wide range of illnesses and situations and has the potential to pay out for many years.

With income protection insurance, everything depends on getting the right policy for you and your specific circumstances – so it’s worth seeing an independent financial adviser or broker for advice.

Keep an eye on creative solutions abroad

In the Netherlands there is something called ‘Broodfonds’ (which means ‘bread funds’), a system where between 20-50 self-employed people group together and pay into a mutual sickness fund. If one of them can’t work due to illness, then the fund will pay out to support them.

Bread funds are ‘affordable, small, transparent and inclusive’. Participants choose their donation level and put aside each month the amount corresponding to that income. The conditions are the same for each participant; people who are older, or who have a medical history or a 'risky' occupation pay no higher monthly contribution. Participants can leave at any time and take their contribution with them.

There’s no formal equivalent of Broodfonds yet in the UK, although a pilot of UK Bread Funds is currently being tested.

Five things we’ve learned about UK micro-businesses in 2017

Posted on 1 December 2017 by Adrian Mather - Jump to comments

Here at FreeAgent, we always like to hear from freelancers and micro-business owners about what it’s *really* like to be self-employed in modern Britain.

Whether it’s the struggle to keep their cash flow healthy, the excitement of expanding into new sectors or simply the enjoyment of having a flexible working life, it’s fascinating to see what life as a micro-business owner looks like and what the main challenges are.

Earlier this year, we asked our customers to answer a few questions in our latest Micro-Business Monitor survey. More than 500 people replied, weighing in on everything from tax and government legislation through to Brexit, late payment and holidays.

Here are some of the common themes we uncovered.

Most micro-business owners aren’t confident about Brexit

With less than a year-and-a-half to go until the UK exits the European Union, we asked people what they thought about the Brexit process and its potential impact on the economy. The results were far from positive.

70% of respondents said they thought that Brexit would have a negative impact on the economy, while just 10% said they thought it would have a positive effect. Many micro-business owners felt that the sting would be felt sooner rather than later - with half (50%) saying they thought that the economy would get worse over the next 6 months.

Many are still unclear about digital tax

Making Tax Digital (MTD) is a flagship proposal by the government to fully digitise tax and essentially put an end to the traditional tax return. Under the current proposals, by April 2019 all small businesses above the VAT threshold and within the scope of MTD will have to keep digital records for VAT purposes and provide VAT return information through MTD-compatible software.

However, many micro-business owners still remain unsure about the plans. Only 36% of respondents said they felt positive about MTD, while 17% said they felt negatively and 27% said they didn’t know how they felt about it. Perhaps most surprisingly, around one in five (19%) people admitted that they didn’t actually know what MTD was. We’ve written a range of guides and articles to help small business owners get to grips with the initiative - so if you’re unsure what MTD involves or would like to brush up on your knowledge, head over to our dedicated resources area.

Micro-business owners are disheartened by the UK tax system

Small businesses may have been lauded by the Prime Minister as the backbone of the economy, but it’s clear that these positive vibes are not entirely reciprocal. Our Micro-Business Monitor found that two thirds (65%) of respondents felt that the government does not provide enough support to businesses like theirs, while just 11% said they thought it did.

Furthermore, the majority of respondents also showed displeasure with the UK tax system, with 72% saying that they felt it was too complicated for small businesses and 78% saying they believed it benefitted larger businesses rather than smaller ones.

They work long hours - and often through sickness

Running a micro-business can be tough work, but our research revealed just how hard it can be. We asked business owners how long they spent working on their ventures per week and nearly a third (30%) said that they spent 48 hours or more - the maximum weekly limit set by the EU - on their businesses. This included 5% who said their business took up 64 hours or more of their time each week!

Combined with these long hours, we also found that many micro-business owners may be risking their health by not taking any sick leave. An overwhelming 82% of respondents said that they had worked through an illness because they did not feel they could afford to take any time off from their business.

Late payment remains a massive issue

The Micro-Business Monitor painted a stark picture of the late payment issue that continues to plague the UK. Only 3% of respondents told us that they had never had a late-paying client; while one in ten (10%) said that they had experienced a client who had never paid them at all. Meanwhile, nearly a fifth (19%) said they had taken legal action against a non-paying client.

Few people appeared to have confidence that the problem would be solved in the near future. 57% of respondents said that despite the recent appointment of a Small Business Commissioner to tackle late payment, they did not think the government was taking the issue seriously enough.

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