Employed or self-employed
A new client (partnership) organises events, mainly themed childrens parties. The event will cost the customer, for example, £200. A booking fee is paid when the booking is made (£100) and this is paid directly to the partnership. The partnership then send an actor to the event to run the actual party and the customer pays the remaining fee (£100) direct to the actor which he/she retains as their fee.
The partnership arranges the event, calls the actor to give them the details, provides a script to follow at the event. The partnership uses three actors to host the events (though will increase this if demand grows) and events are alternated between them according to availability. When an actor is first used they are presented with a pack including all costumes etc required for the events.
Under normal badges of trade, indicators of employment are the fact that the actors are provided with equipment, given specific instructions as to how to perform their tasks and are expecting ongoing work (although this is totally dependent on bookings). Indicators of self-employment are, the fact that they can turn down events if they wish (in which case the partnership would need to contact one of the other actors, the actors themselves do not provide substitutes), they are paid a fixed fee regardless of how long the event is for, they do not get paid if there are no events.
As an additional point I believe that there are different rules for entertainers when determining employment status, compared to other categories of workers.
I would be extremely grateful any any readers able to offer :
(a) an indication of the likely employment status of the actors
(b) an indication of whether the different rules for entertainers would apply in this case.
(c) How those rules can be applied in this case to determine self-employment
(d) Any ideas, if employment is the likely status, of any changes that could be made to the arrangement to weight the status in favour of self-employment.
As as additional point the subject of VAT and turnover threshold is also a matter of concern. In the example above I would be interested to establish whether readers would consider the turnover for the event to be £100 only, or £200 (with a cost of £100). This makes a huge difference to the VAT position as the former is likely to see the business well below the VAT registration threshold, the latter will see it exceeded.
I would be most grateful for readers opinions on all or any of the above. Thank you.
- Spousal transfer and PPR 624 25
- Thoughts on revenue recognition 526 16
- recompense capital input 120 5
- help guys! self employed or still company income? 63 2
- Do I have grounds to dispute our accountant’s fees? 707 19
- Exports/Dispatches - non VAT registered 86 1
- Deferred Tax Asset & Liability 409 12
- Where has Portia gone? 2,207 68
- Financial Advisor / Mortgage brokering 112 1
- Associated disposals - Entrepreneur's relief 178 3
- unmarried couple, two houses, one rental - CGT? 207 7
- Are Sales to Germany considered VAT Taxable turnover for HMRC? 216 5
- New Client wants an Income Certificate for a Mortgage 977 22
- What shall I reduce payments on account to? 184 3
- transferring from franchisee to ltd comapny 244 5
- Merging my businesses 223 3
- Is it worth being a limited company if already a higher rate taxpayer? 483 8
- Is my client risking reputational damage? 374 9
- Sage Vat return box 2 334 1
- Holiday entitlement 592 11
- Services via intermediaries and new HMRC reporting requirements 795
- RTI - duplicate employee record 561
- Pensions Regulator 451
- How hard is it to reduce a code? 412
- Portia ... Where art thou 323
- Sanzar 315
- How do you do it 300
- Digital marketing focus group 298
- Kashflow balance sheet difference 273
- new investor structure 183