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4 Min. Read

Freelance Vs Self-Employed: What’s the Difference?

Freelance Vs Self-Employed: What's the Difference?

There are a wide range of ways to enter into the business world.

Whether you’re looking to be a business owner, a solopreneur or just looking to grab a great job working for a company in an industry you love.

Two terms that are often used interchangeably are being a freelance worker and being self-employed. But whilst there’s no denying that these labels have their similarities, do they really mean the same thing?

We’ll take a close look at being freelance and being self-employed and what these terms actually mean - as well as the difference between the two.

Here’s What We’ll Cover:

What Is Self-Employment?

What Is Freelancing?

What’s the Difference Between Freelance and Self-Employment?

Key Takeaways

What Is Self-Employment?

Self-employment is a break away from the traditional route of employment. It is essentially anyone who handles their own business and has a great degree of autonomy over their work.

Unlike traditionally employed people, self-employed workers get to decide what they work on. They can also decide their working hours and the method in which they carry out their work.

They are their own boss. They have total control over their work and don’t have to answer to a boss or a client. Business owners, entrepreneurs and startup founders tend to fall into this category.

Self-employed workers may enlist the help of employees or even freelancers in helping them run their business. Which leads us nicely onto our next question.

What Is Freelancing?

As their own bosses, freelancers are also self-employed. But freelancers can take on multiple jobs from various clients. They can accept multiple projects at once whereas self-employed workers usually focus on doing the same work every day.

Freelancers will tend to take instruction from their clients and have to work to their requirements. This means that a client has complete control over how a freelancer’s work should look, though they may not have control over how they do it.

A freelance writer, graphic designer, an artist and other such jobs will tend to fall into this category.

What’s the Difference Between Freelance and Self-Employment?

Even though freelance and self-employment have a number of similarities, they also have a fair few differences. Some of these similarities and differences include:

1. Freelancers Often Work Alone

A freelancer can be seen as more of a lone wolf. They tend to take on the work of a few clients and work to their own schedule.

This is different to self-employed individuals who are more likely to hire employees to help run their business.

2. Self-Employed Workers Focus on Building and Growth

Self-employed individuals tend to have an eye on long-term growth whereas freelancers are more likely to hop from job to job.

Being a self-employed worker means that you are trying to grow and expand your business. While freelancers are focused on gaining experience so that they can land bigger, better paying jobs.

3. Both Have Autonomy

Both self-employed workers and freelancers are less likely to have a traditional 9-5 work schedule. They both have the ability to choose who they work with and enjoy a certain level of control over their working week.

Freelancers have the option to choose how much or how little work they want. While self-employed business owners have the freedom of running their own business according to how they want to work.

4. They Both Have the Same Taxes

When filling out taxes, both self-employed workers and freelancers are classified by HMRC as self-employed. They both get similar tax deductions and pay their self-employment tax return in the same way.

This is commonly called being a sole trader and requires you to submit a self-assessment form. It also means that you should be keeping a close eye on your business expenses and business earnings.

Key Takeaways

There is a lot of confusion surrounding self-employed workers and freelancers. Although many people think they are the same thing, and legally speaking they are, there are in fact a lot of differences.

An important thing for self-employed individuals or freelancers to remember is making sure that you have registered as such with HMRC.

Are you looking for more business advice on everything from starting a new business to new business practices?

Then check out the FreshBooks Resource Hub.