Category: Finance for Contractors

Professional contractors have been reminded of the importance of keeping their personal and business finances completely separate.

Being self employed has certain risks, so the two should not be confused, pointed out a spokesperson for the Consumer Credit Counselling Service.

"Some may take out loans and credit cards to support their businesses during tough times, or use the same bank account for both business transactions and their personal day-to-day spending," he explained.

This could mean problems in one area spill over into the other more easily, he warned.

According to figures from Kensington Mortgages there are five million self-employed workers in the UK, with a quarter having been in this position for less than two years.

This means that 1.2 million people have started working for themselves in the last two years - the period during which the recession took hold and caused many job losses.

Posted by Sarah Putt