What working designers should know on financial law
Seemingly, design has nothing in common with financial law. But when it comes to publishing rights, copyrights, and the border between inspiration and plagiarism, a bit of law knowledge may come in extremely handy. If you are working as a freelancer, the skill of reading legal documents is essential to sign a profitable contract and understand the consequences and conditions of your work. Let’s see what you need to work safely
An accountant is always a great help
People rarely combine the talents of an accountant and designer. If you are a designer, you might think about delegating your tax calculations and other boring but practical stuff to the professionals. Later you’ll get some experience, but at the beginning of your designer career, you’ll have lots of other stuff to learn. Keeping in mind your tax obligations and the sheer amount of bookkeeping tasks may eat a big chunk of your working time. So here is your first exercise in finances: count the number of working hours you’ll save by hiring an accountant and the amount of money you’ll earn during these hours.
The accountants can also give you some advice about the sum you need to charge, calculating the sum you’ll get after paying all the taxes. It will help you build up reasonable rates, keep your business profitable, and not have over the top prices.
You need to know how to hire and fire
Sooner or later, your company is going to grow. Even if now it is just you, you’ll have to hire some people when your business expands. Hiring people is not just finding awesome professionals and offering them to work with you. It is also a ton of legal papers, contracts, tax exclusions, and returns. You’ll need another professional to keep it up to date and keep everything safe and legal.
Sadly, running a business isn’t only about hiring people. Sometimes you have to part your ways with some of your colleagues. Make it safe and make sure that firing a person won’t offend anyone and won’t get you fined for ignoring some payments or guarantees. Learn about the essentials of each process, read more on essay on insurance, and you’ll have a much safer company both for you and your employees.
Choose the company structure you need
If you are registering a company, you need to know which company it should be. Learn about the laws of your country or state to understand which structure suits you best. Sole trading is a good start, but it puts some limitations on you (though the taxes are also much more liberating, and the tax calculation process is less excruciating). When you are alone, you are personally responsible for the debts and fines, but you also personally can use the entire company’s income. So your victories and fails are all yours.
Limited liability structures may become an umbrella for you: they are much safer for the owner but are harder to maintain and will cost more. Maybe, there are other ways to organize your company structure – have a look at your local laws and learn more about the perfect way to create your company.
Learn about the copyrights
You keep what you have created, right? Technically, yes, but you have to support it with a bunch of legal documents. Sometimes one mistake leads to you losing all the rights for your creation, and it is the saddest thing that may happen to a designer. It isn’t entirely a financial law, but you need to learn it by heart. What is royalty, what is copyright, what is considered plagiarism, and how to defend yourself and your rights for your creation in the court if you need it. A good lawyer may be invaluable here. Not only may they defend you, but they may also consult you and help you understand your safe zones.
Learn about the invoicing and the ways to pay you
Paying cash isn’t always an option. You have to learn what bank accounts you need, what payment systems are legal and can be used for tax calculations later. Keep an eye on payment terms, return terms and conditions, and the revisions terms. If you are late to the due date, the client may have the right not to pay you. You should learn the rules of invoicing and charging to always be on time and always have a legal cover for your actions.
Financial law may look like something boring and complicated, but it is the rules we use in our everyday life, just not knowing about them. Even if you are a totally creative person, some of this boring but practical stuff may be very useful, especially when you are shifting from a paid employment to a freelance career or – especially – to starting your own company.