I want to ask a simple question.
A person is working in a company 5 days a week. There is no employment contract. he is getting pay on daily basis. He is not on payroll of the company. He does not get paid for holiday or pension. If he is sick or unable to work for any reason, he wont get paid for that day. he is responsible for his own taxes, submit his own tax return. Some times, employer pay him via cheque and some times via bank transfer to his account. He does not have any other job.
Will he be considered as employee or self-employed?
Replies (7)
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A simple question?
I don't want to have to answer one of your harder ones!
Try https://www.gov.uk/guidance/check-employment-status-for-tax initially and https://www.gov.uk/government/collections/employed-or-self-employed for a bit more.
Or take the simple answer provided.
I want to ask a simple question.
A person is working in a company 5 days a week. There is no employment contract. he is getting pay on daily basis. He is not on payroll of the company. He does not get paid for holiday or pension. If he is sick or unable to work for any reason, he wont get paid for that day. he is responsible for his own taxes, submit his own tax return. Some times, employer pay him via cheque and some times via bank transfer to his account. He does not have any other job.
Will he be considered as employee or self-employed?
There is no answer
He is self employed on own admission if he says he is self employed, but was never self employed if HMRC reclassify and choose to go backwards with it
You do not state who is doing the considering
The likelihood he's an employee and entitled to the benefits that being an employee brings.
However, the law is complex, and inconsistent. What is an employee for employment law may not be in tax law.
And don't get me started on the "worker" category.
Scalloway's answer is probably correct, but TD's answer is more to the point.
There is no employment contract.
Is there a self-employment contract?
Difficult to see this arrangement as anything other than employment and consequently any number of tax and employment law rules being breached.
You also say "there is no employment contract".
There not be a written statement of terms and conditions but the exchange of work for pay creates a contract and the law implies certain terms into that contract. Agree with others - on the facts as stated, the parties would have an uphill struggle to convince HMRC this is not employment.