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sole trader with self employed employees

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aaron_515

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Jul 28, 2009
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Hello everyone, hopefully I have posted this in the right section.

I have recently started a company and I am operating as a sole trader (I am also in full time employment). I will be employing people to complete some work for me and they will also be self employed.
Am I right in thinking that I will not have to worry about their national insurance or tax as they will have to do this theirselves at the end of the tax year?
thank you in advance for any help you can offer
 
aaron_515 said:
Hello everyone, hopefully I have posted this in the right section.

I have recently started a company and I am operating as a sole trader (I am also in full time employment). I will be employing people to complete some work for me and they will also be self employed.
Am I right in thinking that I will not have to worry about their national insurance or tax as they will have to do this theirselves at the end of the tax year?
thank you in advance for any help you can offer
Click to expand...

I think that you will have to worry very much about their tax and NI, as you will need to be completely certain that they are genuinely self employed. If you get it wrong, and the Revenue decide that they are really employees, then they will come back to you to pay all of the tax and NI outstanding, based on the amounts that you have paid as being net of tax. :(

The risk with this is all yours and if you get it wrong it will cost you a lot of money.
 
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thanks for the reply.

How could I be sure though? The company is basically a dance company where I get paid to supply ballet dancers etc for entertainment. I will then pay the dancers once they have invoiced me for the previously agreed amount. I will not always have the same dancers and the amounts will change each time.
Is there any way I can be sure they are self employed as I do not want to be liable for their tax and national insurance.
 
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OK if you pay the dancers, then you will be liable for them. As you pay them, you're deemed as employing them ! It's not good enough to say that they're 'self employed' as the Revenue are very switched on to that scam. The only other way is for you to act as a intermediary or an introducer who finds work for the dancers, but who are then paid by the people they dance for, either on a PAYE basis or otherwise. Either way, it takes the onus off you !

I would speak to the Revenue first as they will be able to tell you all you need to know !!
 
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So how comes this is not a problem for my potential clients? For example, I will invoice them for a set amount and they will pay me. It is then up to me to pay my own tax etc as I am self emlpoyed. Surely this is exactly the same and they might be at risk by nto paying my tax and NI?
Sorry if i am missing the point as I am new to all this
 
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aaron_515 said:
So how comes this is not a problem for my potential clients? For example, I will invoice them for a set amount and they will pay me. It is then up to me to pay my own tax etc as I am self emlpoyed. Surely this is exactly the same and they might be at risk by nto paying my tax and NI?
Sorry if i am missing the point as I am new to all this
Click to expand...

No indeed you are right ! You will have to show that you are self employed and that you have looked after your PAYE too. But, because there are so many people offering services as 'self employed', the Revenue will need proof. You personally will have to show this proof and you may have had to employ someone to do your books, you will have to have received the necessary certification etc....but will all of your dancers ? I very much doubt it, so, from my own experience, I wouldn't do a thing until you get the Revenue to explain to you directly how and why so that you don't fall foul of any beauracracy !
 
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