I am an accountant and have recently moved to industry from practice. A friend has approached me asking me to look after his bookkeeping/payroll/accounts alongside my job. This is someone I have worked with before and I am very happy to do the work. It is work I enjoy, it's not a huge time commitment (maybe an hour or two a week?) which I have time for. He doesn't care when it's done as long as things are filed on time. So I have absolutely no concerns about accepting the work. There is also nothing in my current contract preventing me from doing it and my employer is more than happy for me to do what I like as long as it doesn't affect them (I have a couple of other income streams that are not accounts related).
The "client" has said he is happy to take me on as an employee or for me to be self employed and do the work. He will do whatever works for me.
From a tax / NIC perspective it makes no difference. It will be under the NIC threshold and the tax will either be collected monthly through paye or annually on a tax return. I already prepare a tax return due to other sources of income.
The issues I have identified are that if I am self employed I will need to register for money laundering supervision even if its only one client. I could also have issues with my professional body as I don't hold a practicing certificate. If I'm employed neither of these are an issue.
Obviously employment brings benefits and protections, however neither he nor I much care about those. He would pay me a monthly rate either way and would want me to do the work as long as I am happy to do it. It would be a small supplemental income that I don't need, so the added protections of being an employee are irrelevant to me.
I've thought about the tests of employment and really it could be argued either way. He would be paying me to do the work (employment) however I have no one I would pass the work to so in a way it would be hard to assess whether I have the right of substitution (self employed). I can't imagine he would know or care if I paid someone else to do it, but I wouldn't. The deadlines are set by companies house and HMRC so you could argue either way as to whether he is controlling my work or they are. Either self employed or employed I'd be expected to meet those deadlines. The only "tool" I would need to do the work is a laptop that he bought me several months ago as a gift (it was a congrats on the new job gift), so you could argue I'm using my own equipment or equipment he's provided. In terms of holiday pay etc, he's paying a set rate regardless of hours spent so if I take a week off I'll still get paid, he just wants the work done.
As far as I can tell, for such a small amount it doesn't matter either way so I'm edging on being employed to avoid the admin burden of money laundering supervision and potential issues with what services I can provide without a practicing certificate. I also think with only one "client" it's probably more of a second employment than being self employed. Are there any other issues I should consider? Would anyone argue that I should definitely be self employed? I do not intend to take on other clients. I'm only doing it because I enjoy the work, really enjoy working with him and it's not going to be a hassle.