SELF EMPLOYMENT
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SELF EMPLOYMENT
This document is intended to guide self-employed professionals who will be undertaking assignments for our clients through our organisation. It outlines the key considerations of working on a self-employed basis, including your rights, obligations and the potential risks involved. It also highlights important points around employment status and the distinction between independent contracting and employment.
Obligations of a Self-Employed Professional
Administration: You are required to maintain accurate accounting records and ensure proper invoicing. Where invoicing is handled on your behalf by a third party, you remain fully responsible for the accuracy and completeness of your invoices.
Taxes: You are responsible for submitting tax returns and paying income tax and value-added tax (VAT), among other obligations.
Delivery of services: You are expected to carry out the agreed work in line with the terms of the assignment.
Rights of a Self-Employed Professional
Freedom to choose your assignments: You decide which contracts to accept.
Flexibility in how you work and set your rates: You determine your own fees and how you deliver your work.
Tax advantages: Subject to certain conditions, you may benefit from tax reliefs such as the self-employed deduction, start-up relief and SME profit exemption.
Risks and Considerations
Income risk: If you are unable to secure assignments or are unable to work due to illness, you are not entitled to income or benefits comparable to those available to employees.
Liability: You may be held liable for any damages arising from your work.
No automatic social security: You do not build up pension entitlements or benefit from employee protections as a matter of course.
No protection against dismissal: Unlike employees, you do not have statutory protection against dismissal.
Employment status risk: If the working arrangement is deemed to resemble employment rather than genuine self-employment, authorities may take action, potentially leading to penalties or additional tax liabilities.
Key Considerations for Independence
To be considered genuinely self-employed, the working arrangement must reflect independent status in both structure and practice. This includes the use of appropriate contracts and ensuring that the nature of the work supports self-employment.
A genuinely independent position is typically characterised by the following:
You decide how and when the work is carried out.
You provide services to multiple clients.
You take on business risk, for example by using your own equipment, not being paid during illness, and bearing the risk of non-payment.
You can be substituted by another suitably qualified professional.
Additional Considerations
In addition, please take the following into account:
Always work under a properly agreed contract.
Avoid features associated with employment, such as mandatory attendance at internal meetings, working under direct supervision, exclusive use of client resources, or formal performance management processes.
Where possible, ensure you work with multiple clients and avoid reliance on a single source of income.
Take appropriate steps to manage business risks, for example through insurance, financial planning and maintaining sufficient reserves.
Writing
SELF EMPLOYMENT
This document is intended to guide self-employed professionals who will be undertaking assignments for our clients through our organisation. It outlines the key considerations of working on a self-employed basis, including your rights, obligations and the potential risks involved. It also highlights important points around employment status and the distinction between independent contracting and employment.
Obligations of a Self-Employed Professional
Administration: You are required to maintain accurate accounting records and ensure proper invoicing. Where invoicing is handled on your behalf by a third party, you remain fully responsible for the accuracy and completeness of your invoices.
Taxes: You are responsible for submitting tax returns and paying income tax and value-added tax (VAT), among other obligations.
Delivery of services: You are expected to carry out the agreed work in line with the terms of the assignment.
Rights of a Self-Employed Professional
Freedom to choose your assignments: You decide which contracts to accept.
Flexibility in how you work and set your rates: You determine your own fees and how you deliver your work.
Tax advantages: Subject to certain conditions, you may benefit from tax reliefs such as the self-employed deduction, start-up relief and SME profit exemption.
Risks and Considerations
Income risk: If you are unable to secure assignments or are unable to work due to illness, you are not entitled to income or benefits comparable to those available to employees.
Liability: You may be held liable for any damages arising from your work.
No automatic social security: You do not build up pension entitlements or benefit from employee protections as a matter of course.
No protection against dismissal: Unlike employees, you do not have statutory protection against dismissal.
Employment status risk: If the working arrangement is deemed to resemble employment rather than genuine self-employment, authorities may take action, potentially leading to penalties or additional tax liabilities.
Key Considerations for Independence
To be considered genuinely self-employed, the working arrangement must reflect independent status in both structure and practice. This includes the use of appropriate contracts and ensuring that the nature of the work supports self-employment.
A genuinely independent position is typically characterised by the following:
You decide how and when the work is carried out.
You provide services to multiple clients.
You take on business risk, for example by using your own equipment, not being paid during illness, and bearing the risk of non-payment.
You can be substituted by another suitably qualified professional.
Additional Considerations
In addition, please take the following into account:
Always work under a properly agreed contract.
Avoid features associated with employment, such as mandatory attendance at internal meetings, working under direct supervision, exclusive use of client resources, or formal performance management processes.
Where possible, ensure you work with multiple clients and avoid reliance on a single source of income.
Take appropriate steps to manage business risks, for example through insurance, financial planning and maintaining sufficient reserves.