Contractors, freelancers and people running their own businesses are spending an average of 5% of their working hours a month dealing with finance administration issues.
However a study by Workwell and IPSE found issues such as accountancy, tax and insurance take up more than 10% of the time of nearly one in five (17%) of self-employed people.
More than a third (35%) say they spend very little time on financial administration.
Our research questioned contractors and freelancers on the challenges they face. It found rising costs from suppliers is the issue that has become the most challenging in the past 12 months. Nearly half (45%) say dealing with rising costs has become more challenging compared with 23% who highlighted the increased challenges from late payment. Around 10% pointed to increased pressure from hiring staff while one in six (16%) said compliance demands from clients had become tougher with 15% underlining the increased challenges from demands for more detailed reporting from clients. In the year ahead nearly one in five (19%) expect compliance issues with clients to become more of a challenge while the numbers experiencing increased challenges from rising supplier costs will drop to 35%. Chris Mollan, Head of Accountancy Services, said: “Contractors, freelancers and people running their own businesses often underestimate the time they will need to spend ensuring that their business is running smoothly in terms of tax, accountancy and insurance. “The reality is that financial administration will take a substantial amount of time on a monthly basis and the self-employed people need to take that into account or risk potential issues with HMRC. “Running a business successfully requires a clear idea of how you handle financial administration and most contractors, freelancers and small business owners would benefit from expert support on a wide range of issues around accountancy and tax efficiency.” Our award-winning accountancy service is designed to help contractors, freelancers and business owners to manage their business easily and tax-efficiently. Clients are supported by their own dedicated accountant and have online accounting to access and manage their accounts easily, from anywhere. * Workwell commissioned independent research agency Viewsbank to interview 1,447 adults aged 18-plus between July 6th and 18th 2023 including 398 who are self-employed, freelancers or contractors