Am I self-employed?

geordi

Hi there,

Just wondering whether anyone has had any advice of this. I have just signed a consulting agreement with a company, for a fixed term contract. I will be providing IT services for clients, mostly one at the start but in a number of locations. I am paid by day, but the contract clearly states that I alone am liable for tax etc. So am I self-employed in the eyes of the revenue? Am I a contractor? Thanks a million in advance. First time taking work like this and such a headwreck finding what category you fall into :eek:

The_Morrigan

geordi wrote: »

Hi there,

Just wondering whether anyone has had any advice of this. I have just signed a consulting agreement with a company, for a fixed term contract. I will be providing IT services for clients, mostly one at the start but in a number of locations. I am paid by day, but the contract clearly states that I alone am liable for tax etc. So am I self-employed in the eyes of the revenue? Am I a contractor? Thanks a million in advance. First time taking work like this and such a headwreck finding what category you fall into :eek:

There are a series of tests that the courts have had to use to determine if a person is an employee or self employed, and from the cases I've studied it is not a simple yes/no answer.

However, if you are liable for your own taxes I would be inclined to go with the self employed route - but that is not a hard & fast rule.

I would suggest you talk to whomever has negotiated this contract with you and iron out any issues you may have.

clarkey1980

Have a read of this. You or the company can not decide whether you are self employed or not

http://www.revenue.ie/en/tax/it/leaflets/code-of-practice-on-employment-status.pdf

smcgiff

clarkey1980 wrote: »

Have a read of this. You or the company can not decide whether you are self employed or not

http://www.revenue.ie/en/tax/it/leaflets/code-of-practice-on-employment-status.pdf

What he said. Page three is what you want.

Companies benefit with you not being an employee by not having to pay ER PRSI and be liable for other benefits such as holidays. For obvious reasons Revenue would not be happy with this.

Bit curios as to what you mean by various clients - have you individual contracts with each client?

If not, and going by the limited information you've given it seems to me there's a greater likelihood of you being an employee than not.

As said above, that the company have stated that you pay your own taxes has no bearing as to whether your are self employed or an employee.

geordi

smcgiff wrote: »

What he said. Page three is what you want.

Companies benefit with you not being an employee by not having to pay ER PRSI and be liable for other benefits such as holidays. For obvious reasons Revenue would not be happy with this.

Bit curios as to what you mean by various clients - have you individual contracts with each client?

If not, and going by the limited information you've given it seems to me there's a greater likelihood of you being an employee than not.

As said above, that the company have stated that you pay your own taxes has no bearing as to whether your are self employed or an employee.

Thanks for the replies. The only contract I have is with my company. The clients will be dictated through them. From reading through the links it appears that I won't meet many of the self-employed criteria.

Does anyone know then how I go about paying tax? Do I still fill out a TR1? I will be invoicing every month, with monies paid into a separate current account. Just want to make sure I'm on the right side of the Revenue .

clarkey1980

geordi wrote: »

Thanks for the replies. The only contract I have is with my company. The clients will be dictated through them. From reading through the links it appears that I won't meet many of the self-employed criteria.

Does anyone know then how I go about paying tax? Do I still fill out a TR1? I will be invoicing every month, with monies paid into a separate current account. Just want to make sure I'm on the right side of the Revenue .

If you don't satisfy the criteria for self-employment then the company are obliged to register you as an employee and deduct tax under the PAYE system. Your employers could push for you to register a limited company and invoice them through this.

geordi

clarkey1980 wrote: »

If you don't satisfy the criteria for self-employment then the company are obliged to register you as an employee and deduct tax under the PAYE system. Your employers could push for you to register a limited company and invoice them through this.

Yes, I was toying with this idea but tbh I have no idea how long I'm going to be working as a contractor. It is an initial seven month contract. Given my inexperience in these matters and being unsure of what lies ahead, would it be best to set up through an umbrella company?

Dozo

if you go through the umbrella route and you do not meet the criteria of being self employed, so registered as a PAYE worker, does the Agency Workers Directive apply or not ?
Ie should you have the same salary and other benefits as permanent employees ?

How does that apply to for example holidays, where umbrella company workers are paid per day and for permanent workers this is included in their monthly pay.