How to Become Self Employed in 2025

Are you fed up of the corporate BS and wondering how to become self-employed? This guide will help you brainstorm your self-employment idea and get you started on the road to being your own boss, so you can finally make your dream of quitting your 9-5 a reality in 2025! No jargon guaranteed!

Ready to Become Self Employed in 2025?

GET READY TO JOIN MILLIONS DOING WHAT THEY LOVE

According to Statista, as of September 2024, there were around 4.28 million self-employed workers in the United Kingdom. So if you’re thinking about becoming your own boss in 2025, you’ll going to be part of a huge number of people already making money doing what they love, on their own terms.

I’ll be honest: being self-employed isn’t always smooth sailing. It’s hard work, and the road can be bumpy. But the rewards—freedom, flexibility, and building something of your own—are worth it.

After nearly a decade as a business owner, I’ve learned a lot (and made plenty of mistakes along the way). I can’t go back and give myself a cheat sheet, but I can help you avoid some common pitfalls so you can get off to a strong start.

This guide isn’t going to teach you everything about running a business—that would seriously underestimate what it takes to be successful. Instead, we’re focusing on the starting point. 

I’ll help you get set up with the essentials, tackle those tricky tax and money questions, and build a solid foundation so you’re ready to confidently work for yourself and start earning your an income that will enable you to quit your corporate job.

Here’s how it works:

• You’ll find clear steps to follow, complete with action points to help you stay on track.
• I’ve included links to extra resources for when you want to dive deeper into a topic.
• There’s a lot to cover, so take it one task at a time to avoid feeling overwhelmed.

And, don’t forget to bookmark this post so you can come back to it as you work through the steps. 

Let’s get started!

1. Do Some Initial Research

Prepare now and avoid stress later

One of your first steps is to spend a short amount of time researching your business idea. Deciding to become self-employed is super exciting and it’s really easy to dive in and start the ball rolling – but I’ve made that mistake.

If I had only spent a small amount of time researching and planning my business, I would have made far fewer mistakes and been able to move forward from the set-up stage more confidently.

At this stage, just start learning more about your potential business and keep some informal notes. It’s just about getting a flavour of how things will look as a business owner.

Action Steps:

1. Identify exactly you are planning to sell
2. Join/follow relevant social media accounts and groups, including your competitors
3. Start getting an idea of any licences, permits, software and any related costs that you’ll need
4. Research how much people might be willing to pay for the service or product you plan to sell
5. Start gathering ideas together on how you’ll find clients or customers

2. Set a Realistic Start Date

STAY FOCUSSED & MOTIVATED

Before you go any further, set a realistic start date for completing your business set up and officially becoming self-employed. Having a clear date gives you focus and helps you move through the setup phase without drifting.

Your start date doesn’t have to be set in stone—one of the perks of being your own boss is that you can shift deadlines to suit your needs! But aim for a date that feels achievable and use it as a motivator to keep you on track.

Action Steps:

1. Assess how much time you have available to start your business
2. Consider any other reasons, work or personal commitments that may impact your launch timeline
3. Choose your launch date, write it down, and put it in your diary!

3. Clarify Your Business Idea

refining your idea is THE key to your success

Now that you’re starting to think like a business owner and your dreams of being your own boss are feeling in reach, it’s time to start developing your business idea. This is where your work begins and your idea comes to life.

In this phase, you’re going to start ‘putting pen to paper’ to make your business idea clearer and better defined. By the end, you’ll know exactly what you’re selling, who you’re selling to, and why it matters.

One of the biggest challenges I hear from self-employed individuals is that they are struggling to make enough sales. While sometimes there are really good reasons for struggling with sales, I have found that individuals lack clarity on what they are selling, to whom and why. That’s why this next step is really valuable and lays the foundations what happens next in your business.

Action Steps:

1. Briefly describe what your business does
2. Define your ideal audience and client along with their frustrations and hopes
3. Write down what sets you apart from your competitors
4. Put into writing your motivation to go self-employed
5. Craft your mission statement and keep it handy
6. Create your product plan

4. Create a Start-Up Budget

set a solid foundation for your finances

I’d love to tell you that starting a business costs nothing—but in reality, that’s rarely the case. Sure, you can keep expenses low by shopping around, using discount codes, and taking advantage of free trials, but there are still going to be costs involved.

Whether it’s setting up your website, purchasing equipment, or paying for software, you’ll likely need some money upfront to get your business off the ground. The key is knowing how much you’ll need and figuring out how to cover those costs.

The best way to do this? Create a start-up budget.

A start-up budget is a simple spreadsheet that lists all your one-off expenses and the costs needed to keep your business running until you start generating a steady income. This might include things like your email account, software subscriptions, or website hosting.

Once you’ve worked out your total start-up costs, you can decide how to fund them. Savings? A personal loan? A business loan? Choose the option that works best for you.

Action Steps:

1. List your one-off set-up costs
2. Estimate how long it will take you to generate a steady income from your business
3. Calculate start-up costs
4. Decide how you’ll fund getting started

Read => Simple Start Up Budget Template for the Self-Employed

5: Map Out Your First 12 Months

Stay productive and achieve your goals

One of the biggest questions new business owners ask is ‘do I need a business plan’?

If you’ve read any of the generic ‘how to become self-employed’ blogs on page one of Google you’ve most likely been told that you do. And there are many accountants, business owners and bank managers who will disagree with me, but you don’t need a business plan to go self-employed. 

Some businesses do need a business plan because they are seeking outside investment or loan facilities from banks. But many side hustlers and business owners will tell you business plans are overwhelming and time-consuming for solo workers and a distraction from what really matters – becoming your own boss and making enough money toget you out of your 9-5.

Instead, what you do need is a 12 month business game plan: a simple, focused road map to keep you moving forward, making smart decisions, and staying productive—even if your time is limited.

Why 12 Months Is Enough

Most self-employed businesses change quickly in their first year. Your ideas, clients, and even your services can evolve in ways you can’t predict right now. That’s why planning out three, five, or even ten years is often unrealistic for solo business owners.

Your focus should be on your first 12 months. Get those foundational steps in place and start achieving small wins. Down the road, when your business is more established, you can revisit more traditional long-term planning methods. For now, the goal is progress, not perfection.

Action Steps:

1. Set 3–5 Key Business Goals: Think about what you want to achieve in the next year. Whether it’s reaching a specific income level, launching a product, or growing your client base, pick goals that are clear and actionable.
2. Break It Down Into Tasks: For each goal, list the tasks you’ll need to complete to make it happen. For example, if your goal is to land 10 clients, your tasks might include creating a portfolio, networking, and setting up a website.
3. Create a Quarterly Plan: Divide your year into four chunks and decide which goals or tasks you’ll tackle each quarter. This makes your big goals feel more manageable.
4. Draft a 12-Month Marketing Plan: Outline how you’ll promote your business, whether it’s through social media, email marketing, networking, or ads. Focus on strategies that work for your ideal audience.

Remember: Flexibility Is Key

Your 12-month game plan doesn’t need to be set in stone. Part of becoming self-employed is adapting as you go, so give yourself permission to tweak your plan as you learn what works—and what doesn’t.

With a solid 12-month game plan in place, you’ll have a clear vision for where your business is headed and the steps you need to get there. 

6: Choose the Right Business Structure

save tax, minimise your risks

Now that you’ve nailed down your business idea and have a clear vision of how you’ll make money, it’s time to choose your legal structure. This decision affects how you’ll pay taxes, the paperwork you’ll need, and the level of personal liability you’ll have.

Despite the hype, you don’t actually need a Limited Company to run a business and there are other business structures available which may suit your circumstances better. The main ones in the UK are:

• Self-employed (sole trader)
• Limited Company
• Partnership
• Limited liability partnership

Each of these UK business structures requires different paperwork to set up, offer varying levels of personal protection and have their own tax rules to follow. So which one should you choose?

The answer is it depends on your circumstances, wants and needs. 

But Don’t forget, it’s possible to start working for yourself and earn £1,000 in income (not profit) before registering as self-employed with HMRC and paying any tax – this is known as the trading income allowance.

Action Steps:

1. Create a 12 month financial plan to assess your business profits
2. Understand the pros and cons of each business structure
3. Choose your business structure
4. Register your business (unless you plan to use the £1,000 income allowance)

This guide (and most others on my website) assumes you’ll be registering as self-employed, which is the most common and straightforward option for solo entrepreneurs. If you’re setting up a Limited Company, note that some of the rules and processes will differ.

Read => How to Register as Self-Employed in the UK (2025)

With your business structure in place, you’re officially ready to take the next step in your self-employment journey!

7: Pick a Business Name That Stands Out

create the right first impression

Choosing the right name for your business will contribute to your success as well as help you to feel good when you present your business to potential customers and on social media.

Self-Employed Business Names

If you’ve chosen self-employment as your business structure then your own name will legally be your business name. However, you can choose to trade a different name – commonly called a “trading as” name. This option is particularly useful if you’re targeting a specific audience or building a brand identity separate from your own name.

If you’ve chosen a Limited Company then your business will legally have its own name which will appear on the register at Companies House. This name is legally yours, and no one else can use it within the UK.

How to Choose the Perfect Name

1. Make It Memorable: Aim for a name that’s easy to spell, say, and remember.
2. Reflect Your Brand: Your name should align with what you do and resonate with your target audience.
3. Think Long-Term: Choose a name that will grow with your business. Avoid overly niche names if you plan to expand your offerings.

Action Steps:

1. Create a shortlist of business names
2. Check the Limited Company name is available at Companies House*
3. Check the domains are available
4. Check the social media names are available

It’s best to choose a domain and social media usernames that match but if it is not available you could use your own name.

8: Build Your Brand

Strong branding to help your business stand out

Congratulations! You’re getting closer to turning your dreams of self-employment into reality. The hardest part—taking those first steps and working through the setup process—is well underway, and you’re making it happen.

Now, it’s time to focus on creating your business branding, a key step that will make your business feel tangible, professional, and uniquely yours. This is where your business starts to take shape visually, making it easier to connect with your audience and communicate what you stand for.

Why Branding Matters

Branding is more than just a logo or colors—it’s how your business looks, feels, and resonates with your audience. Strong consistent branding can:

• Create Trust: A polished, consistent look shows you’re serious about your business.
• Attract Your Ideal Client: Your branding communicates your values and helps you stand out in your market.
• Set the Tone: Whether you’re going for fun and approachable or sleek and professional, your branding sets expectations.

Action Steps

1. Decide which brand assets you’ll need such as a logo, social media graphics and an email signature
2. Create a colour palette of 3-5 complementary colors that reflect your brand’s personality .
3. Choose a font suite of typically 2-3 fonts for your brand – a headline font, body font and, possibly, decorative font.
4. Create your brand assets

9: Get to Grips With Self-Employed Taxes

stay compliant and stress-free

One of the hardest parts of becoming self-employed can be learning about the money and tax side of things. But that’s hardly surprising if the concept of tax is new to you or you’re used to your employer dealing with it for you through your payslip. 

Now is the time to start understanding what you should be doing, the forms you’ll need to fill in and by when so you are totally prepared.

When you’re self-employed, you’re responsible for:

• Tracking your income and expenses: Keeping detailed and organized records of all your earnings and business costs.
• Filling in an annual tax return: This process is known as self-assessment in the UK.
• Paying taxes on your business profits: 

Getting a handle on the financial side of self-employment early on will save you headaches down the road. With solid systems in place, you’ll:

• Avoid fines or penalties for late or incorrect tax filings.
• Gain confidence in managing your money.
• Make better decisions for growing your business.

So your next task is to get to grips with the money and tax side of things so you can confidently manage your finances.

Action Steps

1. Understand which taxes will affect you as a sole trader
2. Work out how you’ll set aside money for your future tax bills
3. Start tracking your income and expenses

Read => Self-Employed Tax: How It Works and What You Need to Know

10: Set Up Your Basic Business Tools

everything to make self-employment smoother

Hopefully, things are starting to get more exciting as your business takes shape. The next step is to start getting all the core tools you’ll need to run your business in place so you are fully prepared to start marketing, selling and delivering your product/service.

If you haven’t already, this may be when you need to put a little money into becoming self-employed as you sign up for the tools you’ll need. 

Action Steps:

1. Set up your tools 
2. Create templates, resources or freebies
3. Keep a list of your subscriptions, costs and passwords
4. Review your start-up budget to confirm they are in line with your estimated costs

What’s Next For Your Self Employed Journey

A big congratulations—you’ve done it! 🎉You’re ready to launch your business and you’ve got all the business basics in place to start marketing and selling. 

It’s time to start making money without the worry you have done all the right things to start your self-employment journey with confidence.

What’s Next?

Now, it’s all about action. Stick to the game plan you created during this process—it’s your roadmap to success. Revisit it regularly to keep yourself on track, and remember: every small step you take brings you closer to your goals.

And don’t forget, you’re not alone in this journey! Join The Self-Employed Club for tips, tools, and a community of like-minded business owners who are cheering you on. Follow me on Instagram for daily inspiration, updates, and support as you grow your business.

Any Questions?

I’d love to help! If you have any questions about this topic, feel free to reach out on Instagram—I’m always happy to chat and support you on your self-employment journey!

FAQs