The coronavirus pandemic has had a profound impact not only on people’s health but also on their incomes, savings and overall financial circumstances. Although the government introduced some financial support, many self-employed people were left with little or no support.
Even before the pandemic self-employed people were more exposed to financial worries due to a range of issues including fluctuating incomes, late payments and access to financial products. There is also growing concern that financial policies and services are out of touch with the realities of the modern labour market and potentially harming the financial wellbeing of the self-employed.
To find out more about the key financial challenges of the sector and provide practical solutions, IPSE's research team has looking at the financial wellbeing of the self-employed in areas such as late payment, the impact of the pandemic on freelancers' finances and how frequently freelancers should pay their taxes.
Key statistics
72%
Nearly three quarters of freelancers would struggle with the increased administrative burden if they had to pay income tax more frequently.
71%
Over seven in 10 freelancers are concerned about saving for later life.
77%
Over three quarters of freelancers are concerned that sourcing a mortgage will be difficult because of their self-employed status.
56%
Over half of freelancers have experienced late payment at some point in their career.
Equipping the self-employed with training and skills: Data brief 2023
In order to demonstrate to policymakers of the need to promote and encourage the self-employed to upskill and ultimately drive UK economic growth, we’ve put together a data brief on self-employed training and skills in 2023.
From inflationary pressures to inflexibility: Reviewing barriers to financial products for the self-employed
A new research collaboration between IPSE and CMME examines the impact of macroeconomic factors on the financial decision-making of the self-employed, reviewing barriers to accessing mortgages and private finance whilst also evaluating attitudes towards saving for later life.
Late payment and nonpayment: Reviewing the prevalence and impact within the self-employed sector
This report assesses the prevalence of late payment from clients and agencies and evaluates the impact of late payment on freelancers’ mental health and the knock-on consequences for their finances. The report also seeks to understand the scale of nonpayment within the sector, the measures that freelancers adopt to ensure prompt payment and concludes with a series of policy for recommendations for government to address the issues of late payment and nonpayment.
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Freelancers' financial wellbeing: Understanding experiences of savings, pensions and mortgages in 2021
This report examines how satisfied self-employed people are with their current financial situations and how concerned they are about saving for later life. It also explores how people are currently saving and some of the barriers that exist around saving for later life. Furthermore, the research will assess the impact of the pandemic, Brexit and the imposition of government tax policy on future financial plans. The report concludes with a series of recommendations for government and industry around saving for later life, mortgages and how self-employed people can be further supported with their finances.
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A question of time: how often should freelancers pay their taxes?
This report examines the views of the self-employed in relation to the current payment timings, the proposal of more frequent payment of tax and the proposal of moving from retrospective to in-year tax. It will also assess the benefits and challenges of the current system and how freelancers envisage the proposed reforms will affect their self-employed businesses.
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Getting the self-employed on the property ladder
The self-employed have always been at a disadvantage when applying for mortgages, but the financial damage of the pandemic – which has particularly hit freelancers – has pushed the situation from bad to worse. This bespoke research by IPSE and CMME highlights some of the key issues self-employed people face when applying for a mortgage and explores some of the concerns that future homeowners have. It also identifies areas where there is a need for more support from governement and industry to help improve the situation.
Read the reportThe Cost of COVID: How the pandemic is affecting the self-employed
To further understand the gaps in support and freelancers’ deteriorating financial circumstances, IPSE and Starling Bank have collaborated on a dedicated piece of research examining their finances throughout the coronavirus pandemic. The following report focuses on some of the key factors impacting freelancers’ work-related and personal finances. These include their experiences with late payment and completing their tax returns before and since the beginning of the pandemic, as well as accessing financial support from both government and financial institutions over the course of the pandemic.
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Pay Up: How to end late payment for the self-empolyed
Late payment is a multibillion-pound problem for the UK economy and small businesses.
As new research by IPSE shows, it also continues to be the scourge of the self-employed. The majority of those in self-employment experience it and our results show late payment threatens the future of freelancing, as younger self-employed people are particularly badly affected. Our new results also reveal that the problem of unpaid work is getting worse for freelancers.
Read the reportThe path to prosperity: What financial wellbeing looks like for the self-employed
This piece of research by IPSE and Sherpa sheds light on the financial wellbeing of the self-employed and some of the measures that can ensure that self-employment is a sustainable, fulfilling and financially rewarding way of life. It examines the defining factors of financial wellbeing for the self-employed, the key financial challenges they face and sets out recommendations to alleviate any long-term financial concerns among them.
Read the reportWhere next?
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