tim":3aejx5p1 said:
devonwoody":3aejx5p1 said:
If he is self employed he cannot negotiate a rate of pay? the N.I. people would say he was an employee.
???
I believe what DW is getting at is new IR rules (IR56) that "state" that contractors / freelancers etc cannot be paid on an hourly / daily rate basis but rather must be paid according to job spec / quotation. Contractors paid on an hourly or daily rate become employees rather than self employed. It's not quite as simple as that there are guidelines as to what makes one self employed. ie can A supply someone else to do the work, is there a risk that A may lose money rather than make money. If the answer to either is yes then A is self employed, if the answer "no" then A is deemed an employee.
Employee
If you can answer 'Yes' to all of the following questions, you are probably an employee.
* Do you have to do the work yourself?
* Can someone tell you at any time what to do, where to carry out the work or when and how to do it?
* Do you work a set amount of hours?
* Can someone move you from task to task?
* Are you paid by the hour, week, or month?
* Can you get overtime pay or bonus payment?
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Self-employed
If you can answer 'Yes' to all of the following questions, it will usually mean you are self-employed.
* Can you hire someone to do the work for you or engage helpers at your own expense?
* Do you risk your own money?
* Do you provide the main items of equipment you need to do your job, not just the small tools many employees provide for themselves?
* Do you agree to do a job for a fixed price regardless of how long the job may take?
* Can you decide what work to do, how and when to do the work and where to provide the services?
* Do you regularly work for a number of different people?
* Do you have to correct unsatisfactory work in your own time and at your own expense?
Further info on IR56 and regs here
http://www.hmrc.gov.uk/pdfs/ir56.htm#2a
Hope that helps some, interpreting the regs is a minefield, I have been self employed for aeons and some of my clients have been with me for the duration but they haven't managed to keep themselves up to date with the regs meaning that if they were to be inspected by HM tax inspectorate they might experience some embarrassment. Other clients are aware of the regs and find ways around them, some (very few) abide by the letter of the law so to speak.
Going back to Nicks original question, the how much a self emplyed person needs to charge to make a living is a question of how much they want to make and what their day to day costs are. NI, Tax, accounting, health insurance, public liability insurance etc etc etc .
Cheers Mike