Two-Thirds of Brits Plan to Start Businesses in the Future

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Two-Thirds of Brits Plan to Start Businesses in the Future

Two-thirds of Brits now want to start their own company. We decided to investigate and find out what motivates entrepreneurs-to-be and what concerns they may have. 

Two in three Brits have reported that they would like to start their own small business in the future, according to a study by FreeAgent.

This is over ten per cent higher than last year’s survey. 11 per cent are planning to start their business this year, whilst 21 per cent plan to do it in the next few years.

The younger generations are the most entrepreneurial, with four-fifths dreaming of owning their own business in the future. Over half of 35-54-year-olds also have a desire to start their own business. Meanwhile, a third of over 55s are interested in starting up on their own.

In 2021, survey participants were motivated by being able to choose what work they do and by being their own boss. This year the top reason was creating a better work-life balance. Earning more was the seventh-most popular reason. Around a third said they want to fit work around their family commitments. Other motivations include:

  • Wanting to be their own boss (44 per cent)
  • Choosing what work to do (40 per cent)
  • Following their passion (34 per cent)
  • Gaining a greater sense of achievement (30 per cent)

Unfortunately, Covid-19 has caused around a half of respondents to delay starting their own business. On the other hand, due to Covid-10 27 per cent of respondents moved their plans forward, whilst 24 per cent of participants said that Covid-19 didn’t affect their plans at all.

The responses around Brexit were more mixed – 40 per cent agree that Brexit puts them off starting their business, 27 per cent disagreed, and a further 34 per cent neither agreed nor disagreed.

90 per cent of those looking to start their own businesses also have concerns, which include:

  • The financial burden of setting up (51 per cent)
  • Dealing with tax (i.e. National Insurance, VAT, MTD) (39 per cent)
  • Complying with business regulations such as GDPR and IR35 (32 per cent)
  • Managing business finances (29 per cent)
  • A lack of government support for freelancers and small businesses (27 per cent)

The research also showed ongoing confusion around Making Tax Digital (MTD), which is the government’s plan to digitise tax for UK businesses.

Research has shown that only 14 per cent are confident about the rules. This confusion will continue into 2022, as over 80 per cent of participants are unaware of the upcoming 2024 deadline for MTD for Income Tax Self Assessment (ITSA), which will require self-employed people, sole traders and/or landlords that have income over £10,000, to use digital software to manage their finances and file their tax returns.

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