Are you a contractor? If you work for someone else, it is important to know whether you are working for that person in an employed capacity or in a self-employed capacity as an independent contractor.
Your employment status will determine the charge to tax on income from your employment or self-employment. It will also determine the class of NICs, which are to be paid.
Umbrella Companies employ you for tax purposes and complete central returns for all their contractors. It's less hassle and more flexible for you but take home pay is typically less than that the limited company option.
The best option for you depends on your plans, 'one off' contract or 'contractor for life'? [Read More...]
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Engaging workers on a self-employed basis can have a number of attractive features for both parties, but whether someone is your employee or is self-employed depends on the particular working arrangements and not upon the preferences of the people involved. The tax rules for self-employed people are designed to reflect the financial risks taken by people genuinely in business on their own account and should only be applied to those people.
No. Workers sometimes claim that they are self-employed because they do not have a contract with the person for whom they work. What this usually means is that they do not have a written contract, but if they have agreed to work in return for payment, a contract must exist – either a contract of service (employment) or a contract for services (self-employment).It can be written, spoken, implied or a combination of all three. The contract is an important factor in considering employment status and is particularly valuable to the worker because it determines their rights and obligations.
Not necessarily. Just because they hold a certificate or card does not mean that every job they take on is as a self-employed person. It is the actual terms, conditions and facts that apply to each job that determine whether they will be employed or self-employed in that particular case. Certificates and cards show the way that a contractor should treat payments made to the holder if the terms of the engagement are a contract for services (self-employment).If the relationship is a contract of service (employment), then the contractor must deduct PAYE and Class 1 NICs in all circumstances, even if the worker has a certificate or card. There are no certificates and registration cards in the new CIS system.
- General labourers paid by the hour
- Foremen and supervisors
- Heavy plant operators who do not provide the plant
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It's the basics... Compliance with Tax, VAT, PAYE and fiscal arrangements is mandatory for contractors regardless of whether you use an umbrella company or your own limited company.
Incredible then that there are still rogue umbrella companies and limited company accountants who expose their contractors to fraud. Umbrella Compare provides THE solution, we thoroughly vet all umbrella companies and limited company accountants that we list [Read more...].
Umbrella Compare provides a holistic overview of contracting with the aim of helping new and old contractors find the right payroll solutions. Contracting should be about focusing on the contract, not payroll, accounting, HMRC and bureaucracy.