Self-Employment in IT

With the development of digital technologies and free access to the Internet, the concept of self-employment in the IT field has begun to gain popularity among specialists at various levels. Many developers, designers, and other professionals decide to leave their traditional office jobs and go freelance or open their businesses, becoming self-employed.

In this article, we will explore the main trends of self-employment in the IT field, its advantages and disadvantages, and tips for those who are just starting their journey in this direction. We will also discuss how to adapt to the conditions of freelancing and what skills are necessary for a successful career as a self-employed person in the world of technology.

Who Can be Self-Employed in the IT Sector in Belarus

The term “self-employed” is not used in official documents. It is believed that these are IT specialists who are not part of the company’s staff but work under a civil contract. The self-employed include:

1. Payers of Professional Income Tax (PIT)
These specialists are not registered as individual entrepreneurs but independently pay taxes for activities permitted by the state without registering as individual entrepreneurs. These professionals are not eligible to be employed by the company they provide their services to and cannot hire employees.

2. Freelancers who work under civil law contracts
These are specialists who are not registered as company staff but cooperate with them on the basis of civil law contracts. Such specialists, who are not registered as PIT payers, do not pay taxes themselves. In this case, taxes on a freelancer’s income are paid by the company that employs such a specialist.

Each category can work with companies, entrepreneurs, and individuals. Customers enter into civil law contracts with each of these categories (not always with PIT payers), but the taxation of such activities differs.

What Can the Self-Employed Do in the IT Sector

The opportunities to operate in the IT sector differ for those IT professionals who pay professional income tax and those who work without paying professional income tax under civil law contracts.

What Can PIT Payers Do in the IT Sector

The government has defined the specifics of the activities of self-employed IT professionals who pay PITs. They can only operate in the IT field using the Internet to fulfil orders and transmit the results to the client. An important condition is that such services should be provided outside the customer’s location and facilities that he controls. This type of activity is formulated to include many services and work in the field of information technology.

Also, self-employed PIT payers can engage in the following types of activities:

Graphic design.
Create and test websites and software.
Configure computers and software, repair and maintain software.

What Can Freelancers Do if their Clients Pay Taxes for Them

IT specialists hired by companies under civil law contracts can, in principle, perform any technical tasks of the customer. However, such tasks must not look like a departure from the employment relationship, as in this case, fines from regulatory authorities are possible.

What are the Advantages and Disadvantages of Self-Employment in the IT Sector

Self-employment in the IT field is becoming increasingly popular due to its flexibility and high earnings. However, like any approach to work, self-employment has advantages and disadvantages.

Advantages:

1. Flexibility

The ability to choose your working hours and projects.
The freedom to work from anywhere worldwide is especially important for developers, designers, and other IT professionals.

2. High Income

Self-employed professionals generally earn more than their colleagues in the state since the company does not represent “intermediaries.”
The ability to set your payment rates.

3. A Variety of Projects

Working with different clients allows you to develop skills and broaden your horizons.
Wider access to interesting or niche tasks.

4. Independence

Full control over work processes and professional growth.
Lack of office policies and corporate rules.

5. Tax Benefits

In some countries, simplified tax regimes with low rates are provided for the self-employed.

Disadvantages:

1. Unstable Income

Depending on the availability of customers and orders.
Periods of “downtime” are possible, especially in the initial stages or in times of crisis.

2. Self-Management of the Entire Process

A self-employed specialist should carry out projects and look for clients, negotiate, process documents, and track finances.
Lack of support from HR, accounting, or other departments.

3. Lack of Social Guarantees

There are no paid vacations, sick days, or pension contributions. You must plan and pay for all of this yourself.
No insurance against sudden job cuts.

4. High Competition

A large number of specialists, especially on popular freelance platforms.
There is a need to constantly learn and improve skills to remain in demand.

5. Risk of Burnout

Independent work often leads to overwork, especially when simultaneously handling multiple projects.
There is a lack of a clear division between work and personal time.

6. Legal and Tax Difficulties

Accounting of income and expenses, reporting.
You may need the help of a lawyer or accountant to comply with all legal requirements.

Who is Self-Employment in the IT Sector Suitable for

Self-employment benefits experienced professionals with a stable customer base and self-organization skills. However, it may be more difficult for beginners due to competition and a lack of professional connections.

If self-employment is planned for the long term, attention should be paid to financial planning, training, and personal brand formation from the very beginning.

How Can IT Specialists Adapt to Freelance Conditions

Switching to a freelance format for an IT specialist can be difficult, but this process becomes successful and profitable with the right approach. Here are some key aspects that will help you adapt to the new work format:

1. Organization of the Workflow

Daily schedule

Set a clear work schedule to avoid burnout and balance personal and professional life.

Workplace

Create a comfortable place to work to minimize distractions.

Tools and software

Use applications for task management (Trello, Asana), time tracking (Toggl, Clockify) and communication (Slack, Zoom).

2. The Legal and Financial Aspect

Registration of self-employed status

In Belarus, for example, you can register as an PIT payer by downloading the application “Profdohod”. It generates receipts and invoices when working with customers. The application also calculates the amount of tax that must be paid every month until the 22nd (based on income for the previous month). It is how you can legally work with clients and pay taxes.

Keeping records of income and expenses

Record your income and expenses regularly to avoid problems with the tax authorities.

Contracts

Always enter into civil law contracts with clients, especially if you are not a PIT payer. The contracts must specify the working conditions, terms, and payment and which of the parties to the contract pays taxes on income.

3. Customer Search and Portfolio Creation

Platforms for freelancing

A personal brand

Develop your professional profile on LinkedIn, GitHub or other platforms.

Recommendations

Ask satisfied customers for feedback and recommendations to strengthen your reputation.

4. Revenue Management

Pricing

Evaluate your skills and market rates to set competitive but fair prices.

A financial cushion

Create a reserve in case of interruptions between projects.

Diversification.

Work with multiple clients to reduce the risk of losing a single source of income.

5. Self-Development and Training

Constantly upgrade your skills by learning new technologies and programming languages.
Attend webinars and conferences and participate in hackathons to stay updated with industry trends.
Get certificates (AWS, Google, Microsoft) to improve your skills.

6. Psychological Stability

Prepare for instability. In freelancing, periods of high workload can be replaced by lulls.
Learn to turn down toxic clients or projects that don’t match your interests and competencies.
Create a community of like-minded people, or find one to share experiences and keep motivated.

Freelancing in the IT field opens up huge opportunities but requires discipline, flexibility, and the ability to manage your career independently. Following these recommendations, you can successfully adapt and achieve a stable income.

Trends in Self-Employment in the IT Sector

In recent years, there has been an increase in self-employment in the IT sector and a reverse trend — the transition of specialists to hiring. Several factors influence the choice of specialists to favour one of these options. Let’s look at the key trends:

Trends in Self-Employment in IT

1. Globalization and Remote Work
Due to the development of online platforms (Upwork, Toptal, Fiverr, etc.) and the demand for remote services, more and more IT professionals are choosing freelancing. It allows you to work with clients worldwide and set a flexible schedule.

2. Diversification of Income Sources
Self-employment allows one to work on several projects simultaneously, reducing dependence on one employer and ensuring financial stability.

3. The Growing Popularity of Individual Entrepreneurs and Self-Employment (Income Tax)
In countries where the taxation and registration of the self-employed are simplified, specialists are rapidly transitioning to independent work. For example, introducing a tax on professional income in Russia and Belarus has become a popular solution for IT professionals.

4. Desire for Greater Autonomy
Many IT professionals value the freedom to choose projects, customers, and work hours, which makes self-employment attractive.

5. Niche Experts
Highly qualified specialists prefer to work as independent consultants, where incomes are higher and professional reputation grows faster than in hiring.

Trends in Hiring

1. Stability and Social Guarantees
In conditions of economic instability, many IT professionals choose to hire for a guaranteed salary, paid vacations, sick leave, retirement savings, insurance, medicine, and other bonuses.

2. Large Technology Companies Attract Talent
IT giants (Google, Amazon, Microsoft, etc.) offer competitive salaries, bonuses, and unique projects, which can be a strong motivator for many professionals.

3. The Risks of Self-Employment
Freelancing is associated with income instability, difficulties finding customers, and bureaucratic costs, which scare some professionals away.

4. The Complexity of Teamwork for Freelancers
Some specialists are hired to participate in large projects that require teamwork, which is difficult to achieve in a freelance format.

5. Burnout and Desire for Stability
The constant search for orders, deadlines, and stress can lead to burnout, after which specialists look for a more relaxed hiring rhythm.

What Do IT Specialists Choose

In practice, the choice between self-employment and hiring depends on several factors:

The level of professionalism and experience.
Financial goals and ambitions.
Personal preferences in terms of flexibility and stability.

The general trend is that hiring often becomes a launching pad for young professionals with limited experience.

More experienced professionals with a strong portfolio are interested in self-employment and advisory activities.

Many choose a hybrid format: they work for hire and take freelance projects simultaneously.

In the long term, the popularity of self-employment will continue to grow due to the development of technology, platforms for remote work, and simplified tax systems for individual entrepreneurs. However, large corporations are also adapting by offering more flexibility to their employees, which creates a balance between the two models.

Conclusion

Self-employment in the IT field is becoming an increasingly popular work format, offering professionals flexibility, independence, and the ability to manage their time. However, this path requires highly qualified specialists and knowledge of legal and tax nuances. The right choice between self-employment and traditional hiring depends on many factors, including personal goals, professional ambitions, and market conditions.

If you need help finding or hiring employees in the IT field, our company is ready to offer its services. We specialize in the selection of qualified personnel and ensure effective registration of employment relations, taking into account all the features of work in the IT industry. Contact us, and we will help you find the perfect employee or streamline the process of working with self-employed professionals.