Category Archives: money

When is it for real? Five questions to help you spot genuine self-employment opportunities.

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When is it for real? These five questions will help you to spot genuine self-employment opportunities – and identify those to avoid!

Social media channels frequently contain links to opportunities to work flexibly from home, many of which might appeal to parents who want to combine work with being at home for their family. But are they all genuine self-employment opportunities? This piece contains five key questions to ask yourself before taking the plunge.

Is it a genuine product? The first step to try out the product yourself, or try it on someone you know well and ask for honest feedback. Does it work and would you buy it? And if so, can you describe what makes it special, or its ‘unique selling points’, as an advertiser would say? Also take the time to find out if there is any independent research to support any health or wellbeing claims made by the manufacturers of the product. Ideally this should be research published in an academic journal, by a university or by another independent organisation. Products may have received genuinely positive reviews from individuals, but without independent research you can’t be confident that the same benefits will be experienced by a wider group of people. Ultimately, if you are finding it a struggle to get enthusiastic about the product, then call a halt to any plans to sell it to others.

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Is there a demand for the goods or services I am offering? Time spent on market research is never wasted and you should take a moment to think critically about the product you will be selling. Is it something that everyone needs and uses on a regular basis, or more of an occasional or luxury purchase? If the price-point is high and the product is non-essential, then you will almost certainly have fewer potential customers. While goods might be described as high quality and priced alongside famous brands, remember that they won’t have received the same investment in terms of design, marketing and advertising. If you have never heard of a brand up till now; the chances are that your prospective customers won’t have heard of it either. Conduct an informal poll by asking 10 – 20 people the following questions: do you buy this product, how often do you buy it and what are you prepared to pay? If the results are not what you want to hear, perhaps it is time to rethink your plans.

Is the promised income in proportion to what I am being asked to invest or sell? Many entrepreneurs take very little salary in the early days of their business. However, if you are being asked to attend a lot of unpaid training or pay a significant amount of money to join a business, then these might be signs that it is not a genuine self-employment opportunity. Try working out when you would be likely to ‘break even’ on your initial investment. A simple way to do this is to cost your time at the equivalent of national minimum wage. Compare that total to the number of sales you might make in the average week. How many weeks would it take for you to pay back that initial investment of money and time? On the other hand, if the promised earnings are very high, does that seem realistic and in proportion to the margins on the products? Look at the cost and sale price of one of your products and calculate how many would you need to sell in order to generate the promised income. As the saying goes: if it sounds too good to be true, it probably is! Be extra careful if information about the pricing of the product is not freely available from the supplier or distributor.

Cosmetics in different colours

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Am I free to develop my business at my own pace or in my own style? If another person is trying to heavily influence the way in which you conduct your business, what you are doing and when, then this might be a warning sign that it is not a genuine self-employment opportunity. Put it another way, if you did all the hard work of opening up a stall at a craft market – making the goods, carrying the table, unloading all the stock – would you then let someone else take charge of how you price and sell the products? While employees generally have to work at an agreed location, for fixed hours and within a management structure, self-employed people should be free to set their own terms, answer to themselves and turn down work if they wish. The freedom to develop a business in your own way is the upside of the lack of regular salary!

Am I comfortable with what I need to do to make the business successful? Finally, it is important that you feel true to yourself and are comfortable with what you do as part of your work. If someone else is pressing you to adopt behaviours that are not normal for you, then this is a warning sign. While we all might need the occasional push to step outside our comfort zone, you should still feel able to say no without fear of repercussions. Ask a trusted friend or relative what they think about the business and whether you are suited to that way of working. The views of someone who knows you well are always worth having, even if you choose not to act on their advice. As a general rule, if you are regularly being asked, or even pressured, to do something that you feel goes against your own privacy, safety or which intrudes into your personal and family life, then consider whether you want to continue with this business in the longer term.

Woman daydreaming of a new idea

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So if you can answer yes to all those questions – good luck with your business, go forth and prosper! If you cannot answer positively then you may want to take a look at these further resources.

Citizens Advice Bureau page on avoiding common scams, including employment or business based scams.

If you are thinking of selling dietary supplements, click here for an NHS research-based guide to their regulation and the evidence for their use.

Government information on the rules for ensuring that goods and products are safe and fit for purpose, including cosmetics and children’s toys.

The Direct Selling Association has pages on how to identify genuine direct selling earning opportunities and how to avoid illegal schemes.

Please note that this blog is only a guide and you should always seek advice tailored to your own circumstances before making decisions that may have financial implications.

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How to register for the new tax-free childcare scheme

Register for the scheme online

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If you read my recent blog post outlining the key features of the government’s new tax-free childcare scheme then you may be interested in getting on board!  The scheme is now live and registration is open to parents of children aged three and under, with plans to roll it out to all eligible age groups in the course of 2017-18.

Step 1:  Check if you fall within the eligibility criteria

The key eligibility criteria for the tax-free childcare scheme are:

  • You have a child aged under 12 (or under 17 if they are disabled)*
  • You are employed or self employed
  • You earn less than £100,00 per year but more than £120 per week
  • You are not receiving other support with childcare costs, including the employer-supported childcare voucher scheme.

*At the moment your child needs to be under four years of age on 31st August 2017, but this will change as the scheme rolls out to all age groups.   A detailed list of eligibility criteria is available for the scheme.

There is one interesting exception to the earnings criteria. If you are a new business in your ‘start-up period’, defined as the first year of operating, then you do not have to meet the lower earnings criteria of £120 per week.  This could be helpful to parents making a transition to self-employment, but who also need to pay for childcare in order to work.

So is the scheme for you? If yes, then the next step is to check if your early years provider is registered and then begin the process.   If you don’t fall within the eligibility criteria, consider whether other options such as the employer-supported childcare vouchers scheme, the childcare element of working tax credits or childcare support available to students might be open to you.  There is also a Childcare Calculator that might be helpful in working out the best option for your family.

Step 2:  Check if your early years provider has registered for the scheme

It is worth pausing now to check if your early years provider has registered for the tax-free childcare scheme, as otherwise you might spend time going through the registration process yourself but be unable to make them any payments.   All early years and childcare providers have been invited to register, but as with all new initiatives it can take time for everyone to be up and running.  The application process asks you to check if your provider is registered, but the link to do so is not easy to find.  Click here to enter your provider details and find out if they have registered for the scheme.   If they haven’t yet registered then it might be worth getting in touch and encouraging them to sign up.

Step 3:  Navigate to the start of the application process

As usual, when going through a web-based process, it is quite useful to have a number of tabs open on your browser and either paste links into a new tab or use the ‘open in new tab’ option, available on the right click on Windows PCs.  The main site we will be using is the new government Childcare Choices website at www.childcarechoices.gov.uk.

Home page for the Childcare Choices website

Home page for the Childcare Choices website

Either scroll down the home page or click the turquoise arrow that will take you to the various options for different age groups.  As this scheme applies to children under the age of twelve  (or under seventeen if they have a disability), you have to scroll a little way down the page to reach the buttons we need.

Tax-free childcare option on Childcare Choices website

Tax-free childcare option on Childcare Choices website

There they are!  The registration process now takes you off the shiny new Childcare Choices site and on to the rather plain, but very useful, Gov.uk site.   Here you need to choose menu option 4, Access the childcare service as a parent, as per the screenshot below:

Highlighted menu option for applying for tax free childcare on Gov.uk

Highlighted menu option for applying for tax free childcare on Gov.uk

Click that link and it will take you to the following page, which is the beginning of the application process:

Start here to apply for tax-free childcare on Gov.uk

Start here to apply for tax-free childcare on Gov.uk

Step 3: Begin initial eligibility screening

You will now be asked if you have been invited to register for the scheme, presumably because the government has been sending postal or email initiations to specific groups.   Click ‘No’ if that is not the case.  You now need to enter the date of birth of your youngest child.

Form to enter the date of birth of your youngest child on Gov.uk

Form to enter the date of birth of your youngest child on Gov.uk

If your child will be under 4 years old by 31st August, you are now taken to the Government Gateway login to begin the registration process.   Registering with the Government Gateway enables you to sign up for any of the UK government’s services that are available over the internet. If you already complete a tax return, manage your driving licence online or use the statutory Child Maintenance Service, then this service will be familiar to you.  Now is the time to gather some of the information that may be helpful in the process.

Sign in to the Government Gateway to register for tax-free childcare

Sign in to the Government Gateway to register for tax-free childcare

Step 5: Register or login to the Government Gateway to access the scheme

You can now either login or set up a new account on the Government Gateway to enter your personal details and confirm your eligibility for the scheme.  Remember that if you are not currently eligible for the tax-free childcare scheme you can register to receive email updates once it does become available to you. The government are rolling it out to different age groups in the course of 2017-18.

Thanks for reading and good luck with the registration process!  If you have anything to add about the process of registering for the scheme, leave a comment below.

Please note that this blog is only a guide and some parents may be better off remaining with other schemes to support parents with the cost of childcare. You should always seek advice tailored to your own circumstances before making decisions that may have financial implications.

If you have found this article useful please comment and share it with your friends and followers on social media!

Three great features of the new government tax-free childcare scheme

English currency pounds sterling help with childcare costs

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April 2017 is the launch of the long-awaited government tax-free childcare scheme.   But what are some of the advantages to parents?

No. 1 – You can get the tax advantage whether you work for an employer or for yourself

You may be one of the lucky people currently able to access an employer-supported childcare voucher scheme, offering a way for parents to pay for some of their childcare costs out of their pre-tax income. However, not all employers are keen to administer a childcare voucher scheme, despite the potential to make savings on employer NI contributions. So, up until now, if you worked for such an employer, you missed out on the tax advantages of the vouchers. Self-employed parents were also out in the cold, unless they fancied forming a limited company in order to administer childcare vouchers to themselves…! However, the good news is that the new tax-free childcare scheme is based around an online account held by parents and your employer does not have to be involved at all.

No. 2 – You can pay in what you want and when you want, up to agreed limits

The existing employer-supported childcare voucher scheme asks you to nominate an amount of vouchers to ‘buy’ through salary sacrifice from your pre-tax and pre-NI income. The limit is £243.00 per month, so you can nominate any amount up to that monthly limit. However, if you want to vary that amount from one month to another it needs to be arranged via your employer and implemented in the next payroll. Under the new scheme, parents have direct control of what they pay in to the tax-free childcare account. You can pay in a lot one month, a little the next, as long as you stay under the overall total account limit of £10,000 per child. The ability to vary the payment amounts will be of particular benefit if your income varies a lot from month to month, or if you are on a tight budget. If you get an unexpected bill, money that you need right now won’t be locked away in the form of childcare vouchers. You can also withdraw money from the account if your situation changes.

No. 3 – Your money grows by 20%, so you are getting your basic-rate tax back again

For every 80p that is paid into the account, the government will top it up an extra 20p. The total amount that can be saved is capped at £2,000 per child, per year. So if you pay in £8,000 over the year to spend on childcare for your child, the government will give you £2,000. For disabled children the contribution will be £4,000. If you are a basic rate taxpayer you will effectively be getting a refund of the tax that you have paid on £10,000 of your earnings – now that’s what I call a rebate! Once the money is in your account you can use the topped-up amount to pay for early years provision or childcare offered by an Ofsted registered provider. That means Ofsted-registered nurseries, after-school clubs or playschemes, pre-schools, playgroups and nannies. It can also be used to pay for home care-workers working for a registered home care agency. Both you and your provider will need to register for the tax-free childcare scheme via the Childcare Choices website.

So these are three great features of the new government tax-free childcare scheme!

There are additional eligibility criteria for the new scheme, so do take a look at this page on YouGov for more details. Please note that this blog is only a guide and some parents may be better off remaining with other schemes to support parents with the cost of childcare. You should always seek advice tailored to your own circumstances before making decisions that may have financial implications.

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Welcome to www.parent-to-work.com!

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This site is designed to provide some of the information and support that you might need when you decide to become a working parent.

Here you will find information about:

  • Different types of childcare available in the UK and what might be best for your family
  • News that might affect you or your childcare provider
  • How to work in partnership with your employer
  • Making the most of balancing work and family life

If you find this site useful please share it with your friends and followers on social media!