There are the standard utilities — mortgage, electricity, heating, phone and broadband. If working from home, you can reclaim a percentage of these bills when filing your tax return. If your studio is away from your home then the full spend is tax deductible.

Then there are the workspace basics — desk, chair, computer, software, printer/scanner, ink, paper, a lamp, a bookcase (and books), shelves, sketchpads, pens, pencils, a good external mic, headphones, external hard drive. Be sure to keep your receipts for tax deduction.

Kelli Anderson standup deskKelli Anderson’s stand-up IKEA desk hack.

A few things more specific to the profession — Adobe CC, font licensing, LiveSurface and other mockup resources, MailChimp, web hosting, and domain registration (I use Namecheap). A good camera, tripod, lighting rig, and backdrop will help you shoot print work for your portfolio.

Other expenses might include travel for meetings, postage for letters and packages, classes from sites like Skillshare and CreativeLive, an accountant (unless you file your own returns), but that mostly covers it.

Related, from the archives: Reflections on design self-employment.

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January 6, 2015

Comments

Tax, how could I forget? 30 percent (give or take, depending on the bracket) of all you earn needs kept aside for the taxman. I put mine in a savings account until the payment deadline.

A considerable part of my outgoings are accountancy fees and legal fees.

My accounts are too complicated to do myself, and they are an unnecessary distraction. I use a lawyer to help me with contracts and write licences for software I create.

I spend half a day each year filing my return. Very few parts of the form apply to me, so it’s easy enough. Book royalties are tricky. My publisher keeps 30 percent for US tax, which I need to claim back through US/UK tax credit relief. An accountant’s checking things this year, though.

Hey Frankie! I love working from home. Here are some other points to consider. Get Self-employment Disability Insurance. I am not sure how your government plans work where you are, but in Canada we need disability insurance if we are self-employed. If you have a spouse their plan may or may not cover you (my spouse’s insurance doesn’t cover me). Another insurance to consider is “Errors and Omissions” or Professional Liability insurance.

Another item I use that I can’t do without is an Estimation/Time-Tracking software. I use an online app called GetTheHarvest (Harvest; something like $11/month) but there are others out there. Harvest is well-designed so my invoices look pretty; easy to use; great customer service (often same day) and you can generate invoices from the estimates as well as have your clients pay you online by paypal or credit. Super easy.

You’ll likely want Plans for online storage and online backup. You don’t want to get caught losing valuable (invaluable) client files.

Pantone books!

If you plan on becoming a member of a national Graphic Design association, you may want to add that in too. Some of those associations offer monthly payments too rather that one large yearly payment. Not necessary but associations like that are wonderful for advice, mentoring, and networking. Best of luck! Hope this helps.

joce

A lot of project based expenses (rental, materials, etc.) can be billed to the client, but sometimes you will buy or license things for use over multiple projects (whether it’s buying an extended license for software, images or fonts, or buying things like paper and ink in bulk). It’s worth doing the calculations to see if stocking up makes more sense than buying each time.

When you start out you will likely also be investing with relationships, whether with new clients, suppliers or potential collaborators. Different parts of the world have different laws on this, but in general, you can expense some of your meeting, food and travel costs, providing they were incurred in the aim of getting new business.

Depending on if and how you choose to promote yourself, you might spend on producing promotional collateral and advertising.

I invest in membership to a local networking group – vital for my business so far (not necessarily forever). Getting out there and meeting local businesses is a great way to spread the net wide and become known to lots of new people. Depends what stage of business you’re at and what, specifically, you want to achieve though.

David, slightly off topic, but an interesting read nevertheless. I reacted to the standing desk pic.

Why I killed my standing desk

As far as tax deducts go, there are 2 schools. Keep it simple, or go itemized. For itemized you need to be super cheap, keep all receipts, (for 7 years, which feels like work to me at least) and maybe you save more. I think this is decided by your core personality more than anything else. :)

And I think you should look at some kind of damage insurance and liability insurance. But then you are not in litigation territory like the US or Canada. So don’t know how it is on your side of the pond. :)

As always a good article. Keep it coming.

A good read, Lak. Here’s an apt quote:

“Standing is not necessarily better than sitting if you do it for a prolonged period of time.”

My receipts are few, so filing/storing them for six years isn’t a hassle. I have a lot of emails older than that (I suppose I should get rid).

In my case insurance would be necessary if clients came to my workplace. For almost all of them that’d mean a flight, though, so it’s not needed.

Thanks for the thoughts, everyone.

Interesting read as I’ve just read your book David (design for love) and am about to embark on a design partnership with two other designers.

The most costly thing I’m up against at the moment is rent (setting up in London). The only relief is that I’m looking to “live/work”. This seems to be getting more popular in London. So rather than working at home, you’re actually living at work.

I come from Dublin and I’m thinking about setting up there instead as it is much cheaper and the availability of warehouse space is huge.

David, do you think location matters, such as basing one’s business in London?

You probably also have to mention stock photography. It takes a large chunk of my monthly budget. Sure, there are free quality stock photos websites, but sometimes you just need a photo of something on a white background :)

I pay an accountant but also for online accounting. I also pay for freelancers, and other outsourcing such as web dev. I pay insurance, which is already mentioned. I forked out for a good selection of books in areas I needed to stretch myself as well.

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