Similarly to plumbers and builders, mechanics can start their own business or become self-employed and enjoy the benefits of being their own boss. But can you make more money being self-employed rather than an employee?
Keep reading to find out:
- How much could you make as a self-employed mechanic?
- How to become a self-employed mechanic?
- What are some pros and cons to being self-employed?
- How to track and increase your income as a self-employed mechanic?
How much could you make as a self-employed mechanic?
According to the UK government careers website, motor mechanics can make about £18k- £35k a year, depending on their experience and expertise. You can become a mechanic by attending a college course or through an apprenticeship.
Apprentices are entitled to a minimum apprentice rate of £4.30 per hour. If an apprentice has completed their first year of training and is at least 19 years old, they are entitled to a minimum wage of £8.36 per hour.
How to become a self-employed mechanic?
To become a mechanic, you would need to complete a college course or an apprenticeship. You can also complete an intermediate or advanced apprenticeship as a motor vehicle service and maintenance technician. This will usually take 2 to 3 years. You’ll do on-the-job training and spend time at a college or training provider.
Relevant courses for mechanics courses include:
- Level 2 Diploma in Light Vehicle Maintenance and Repair
- Level 3 Diploma in Vehicle Technology
- 2 or more GCSEs at grades 9 to 3 (A* to D), or equivalent, for a level 2 course
- 4 or 5 GCSEs at grades 9 to 4 (A* to C), or equivalent, for a level 3 course
Entry requirements for apprentices:
- some GCSEs, usually including English and maths, or equivalent, for an intermediate apprenticeship
- 5 GCSEs at grades 9 to 4 (A* to C), or equivalent, including English and maths, for an advanced apprenticeship
You could also train as a vehicle mechanic in the British Army.
To become self-employed, you need to register your business with the HMRC. Once you’ve got your qualifications, you can get business insurance and become self-employed. You may not be able to get insurance, or your insurance policy could be void if you don’t hold the relevant qualifications.
What are some pros and cons to being self-employed?
There are some significant benefits to quitting working for other people and becoming self-employed. We’ve listed some pros and cons of being a self-employed mechanic.
Pros of working for yourself:
- Being your own boss
- Getting to work with vehicles of all kinds
- Getting paid more by specialising or becoming an expert
- Setting your own working hours
- Getting paid to do what you love
- Ability to claim back tax on tools and clothing
- You can decide where you want to work
- You can set your own rates
- Choose which jobs you take on
With the ability to set your own rates and to claim back some of your expenses in your Self Assessment tax return, you can end up earning more self-employed than you would at a job.
You can also decide to make your mechanics business mobile. Instead of working out of a garage, you could travel to your clients, offering the convenience that other mechanics can’t. At the same time, you could save on rent and utilities for a permanent garage. Working in this way would allow you to find clients all over the country, giving you more potential business.
Cons of working for yourself:
- Submitting a Self Assessment tax return every year
- Paying your own tax and national insurance contributions
- Having to create a viable Business Plan
- You can’t claim Statutory Sick Pay if you’re self-employed
- Buying your own tools and equipment
- Paying rent and utilities for a garage
- Being responsible for finding your own customers
You’ll have a broader range of responsibilities when you are self-employed as opposed to an employee. For example, you’ll be in charge of your marketing and sales, bookkeeping and you will also need to cover all your business costs. You won’t get any Statutory Sick Pay if you’re self-employed, but you might be covered if your business is set up as a limited company.
How to track and increase your income as a self-employed mechanic?
Running your own business means you are in charge of tracking your own income and expenses. Keeping accurate, organised records of your finances is necessary for submitting your tax returns correctly. Mistakes in your tax return can cause you to pay an incorrect amount in tax and result in an audit or penalties.
Tips to help keep track of your income and expenses
- Separate personal and business accounts
- Create an invoicing system
- Use technology to track finances daily
Accounting apps like Countingup let you open a separate business account. It can pull data directly from the account to instantly categorise expenses, track income, and give you tax estimates to help you budget for your expenses and tax bill.
You can also easily create and send invoices and track unpaid invoices.
Tips on how to increase your income
- Create a professional website
- Build a good marketing strategy
- Use social media to reach new customers
- Charge more (learn about how to notify customers of a price increase)
- Claim all relevant expenses
When you’re self-employed, your income can potentially be a lot bigger than what you can make at a job. The best way to increase your income is to get more clients. Make sure you have a good marketing strategy and that potential clients can find you. The best way to make yourself visible is to have a professional website with good SEO.
Organise and track your finances with Countingup
When you’re starting your own business, it’s important to keep your personal and business finances separate from day one – to save yourself from time-consuming admin headaches further down the line.
When you sign up for a Countingup business current account, you’ll receive free accounting software with a range of time-saving tools.
With automatic expense categorisation, receipt capture tools and cash flow insights, you can confidently keep on top of your business finances and save yourself hours of accounting admin, so you can focus on doing what you do best. Find out more here.