sub contract

jamesy08

Hi All,ive had an employee since last september,and as things have gotten slow,and ive just paid him for 2 weeks holidays,but said to him that there may be no work for him on his return,instead of employing him in the normal fashion on his return,in other words,can he become a sub contractor,so he pays his own tax insurance,etc,and if i need him for 3 days,ill call him
thanks jamesy

johnlawlor

I was a sub contractor for a while in construction , I got a c45 every month from the main contractor, I just kept an invoice book to record payments. As a subcontractor you pay 35% tax which can be reclaimed by your accountant. you should also make sure you pay your own prsi as you will not get unemployment benefit .
Maybe the best thing for him to do is go on a 3 dayweek and get social welfare for the other 2 ?

Lorelei

c45 applies in construction industry not in other. Make sure that he is supplying his own tools, can decide how he works and what hours himself e.g you can only say I need this completed by xx date/time and you cannot start before xxx, he quotes you a price, is responsibel for own taxes etc is trading under his own name or a registered name is registered for tax as self employed and a critieria which is often applied is paying own business liablilty insurance theres a lot of other things so be careful.
If your are found to be employing someone and claiming them to be self employed as a sub contractor besides fines you could be liable for back taxes, PRSI, holiday pay, as well as heavy fine.
Make sure he is able to work for other customers and not purely reliant on you.
Its risky

sonic74f

There are financial companies that deal specifically with this situation where a contractor is employed in but where he/she does not want to register as a sole trader. They set you up with all the legal structure of a sole trader with out the hassle. If you want the website or company name I can pm it on to you(not sure if boards allow it to be put up on the forum).