With HMRC racking up cases against the likes of Uber, Deliveroo and Pimilco Plumbers it can be worrying if you are self-employed and only work for one company.
Why Are HMRC Getting So Heavy
When a business takes on a person on a self-employed basis rather than as an employee, they avoid having to:
- Run payroll;
- Pay employers national i
nsuranceat 13.8% of gross salary;
- Give paid holiday allowances;
- Provide benefits like maternity leave and sick pay.
In order to protect the rights of workers forced into self-employment arrangements and stop employers who are avoiding National Insurance, HMRC is ramping up their efforts into investigating businesses.
Especially those where people are self-employed and only work for one company.
Can You Be Self-Employed and Only Work for One Company?
If you are just starting out as self-employed, then it is perfectly possible that you only work for one Company while you are searching for new work.
However, if you are in an arrangement with a Company where you are effectively employed, then you should review your situation.
HMRC have certain rules to determine whether you are self-employed or employed (regardless of how you are being paid).
How to Check Your Employment Status
Just invoicing a company is not enough to show self-employed. The HMRC rules look beyond the paperwork.
You are considered self-employed if you’re:
- in business for yourself, are responsible for the success or failure of your business and can make a loss or a profit;
- able to decide what work you do and when, where or how to do it;
- able to hire someone else to do the work;
- responsible for fixing any unsatisfactory work in your own time;
- your client agrees a fixed price for work – it doesn’t depend on how long the job takes to finish;
- using your own money to buy business assets, cover running costs, and provide tools and equipment for your work;
- not restricted for working just that client.
If your arrangement doesn’t satisfy these rules, then you should probably be employed by the Company.
Checking Your Employment Status Online
HMRC have an online tool that helps you to check your employment status.
Alternatively you can call HMRC on 0300 123 2326.
Read More: Can I Be Employed and Self-Employed
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