Accounting Advice – Employment
My business has grown and I need an extra person. Do I have to take them on as an employee?
If you take on an employee you will have to consider: Employer’s National Insurance, Employers Liability Insurance, Statutory Holidays etc. etc.
Hiring a self-employed worker could be more beneficial; basically because you have less legal responsibilities if you are not an employer. However, this can potentially lead to other problems such as HMRC deciding they are an employee and you have paid ‘wages’. They can then demand Employer’s National Insurance. Speak to your accountant to clarify this.
A key issue is whether they are directly managed by you to carry out their work. For instance, if they are working under their own control they can be classed as self-employed. However, if you manage them they are more likely to be classed as an employee.
Peter Bromiley ACA
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