What's the difference Freelance/Self-employed

[Guest lightnix]

...instead of them invoicing you for £200 you have to pay them somewhere in the region of £163...

It might even be less than that, when you consider that the employers will also have to pay Employers NICs, too. Let's see now...

 

£200 gross pay, less...

£46 Income Tax (@ 22%) and...

£22 Employee's NIC's (@ 11%) and...

£22 Employer's NIC's (@ 11%) equals...

 

£110 per day take home

 

And that's before we get around to the cost of the PPE, training and (perhaps) additional insurance premiums, that the employers will also have to start meeting :)

 

...so I feel that they will also become harder to come by.

They are already - at least the good, experienced ones are. It'll be interesting to see what happens, by the time we get to the Olympic opening ceremony

 

 

e2a...

One other thing (sorry)...

I... carry out all the necessary H&S checks, paperwork, etc.

So how (given that you're already presumably working a 40 hour week) do you ensure that you do not become too fatigued to work safely.

[David Lee]

Yes there is. As discussed in other threads: the fact that they have the cushion of a full time wage to fall back on, means that they frequently (if not always) undercut the rates of those who rely on their freelance income to make their living. This adds further downward pressure on rates, which are arguably not high enough already. Also, the Moonlighters frequently do not carry any PLI and are therefore a form of cowboy labour IMO.

 

so there is NO WAY he is paying tax on what he is doing. And conveniently enough for him, as he can schedule in his own times, so he can do as many freelance jobs as he wants,

 

 

I think this is missing the point. I repeat, there is nothing wrong with being self employed (freelance) and working full time. As long as tax etc is paid up. If that person is undercutting us then that may be morally reprehensible, but in the eyes of the law (once again) if he is paid up on taxes, has PLI etc then he is ok with HMRC.

 

The costs he or she charges is another discussion, I was merely responding to the fact that it is not "naughty".

 

There are also freelancers who undercut the considered norms in order to gain work without the cushion of a full time job. Where do we draw the line? I don't cut my costs, am fully freelance and have plenty of work - and I am not the only one.

 

p.s. in answer to the original question - AFAIK the word freelance does not come into HMRC parlance. You are either full/part time employed and on PAYE or you are self employed and commit to self assessment. We just use and abuse the term freelance to say we have no commitment or affiliation with one single company.

[indyld]

The Office has been the most interesting forum on the BR recently. Sign of the times.

 

I have been fascinated by a number of the recent threads and put keyboard to screen, addressing some of the latest issues and adding my ideas. Take a minute to pop over to OSL and have a read of Boom and Bust in the Lighting Business.

 

And don't forget to leave your comment at the bottom of the page.

 

Cheers

[zonino]

p.s. in answer to the original question - AFAIK the word freelance does not come into HMRC parlance. You are either full/part time employed and on PAYE or you are self employed and commit to self assessment. We just use and abuse the term freelance to say we have no commitment or affiliation with one single company.

 

quite correct, it doesn't, there is:

 

Self-Employed

Employed ( the "7 day rule" may apply)

 

I imagine that HMRC will take a similar stance to that they did for the film and tv industry - http://www.hmrc.gov.uk/specialist/fi_guidance_notes2003.pdf

 

Unfortunately sparks are generally not considered to be eligible for self-employed status.

[The Boogie Man]

Which is what I thought. I was in the building trade for 25 years and had never come across the term before. In our game your one or the other. You carn't even be labour only to a main contractor now, they want you on the cards or on your own.

 

Before this thread was split away from the original, I asked the qestion because what was being described was what we call subby bashing.

When the subbys on a big job are all being paid late it's a good sign there's trouble brewing further up the food chain.

Or as has been stated before the little guys are being used as an interest free loan or cash flow bridge.

 

As well as never having waited a minute longer than 30 day from invoice for payment my t+cs used to state the client will be expected to pay draws against monies owed during the contract. Cue much laughter from the techs on here at that idea!!

 

Baz

[Grum]

I feel your missing the point. The fact here, is you have a DAY job which you make your living on, then go and work (instead of some other freelancer) on a job. Regardless of how much tax you pay, or how much PLI you have, the point is, to do that freelance job, you have done someone else out of work, the someone else most likely a freelancer who make their living on working - meanwhile you have a day time job you can do, so the freelancing is just extra cash in your pocket... That more than anything else is why this is very, very annoying for true freelancers that don't have full time jobs to make their living from.

 

Not everyone who has a full time job is like this!!!!

 

Personally I work for a local college (it a part time contract but I usually end up doing full tim hours during term time) as a performing arts technician.

 

I also own my own kit, a few macs, a media server and a desk. I hire these out to the college when shows require them. Except for the desk which I use all of the time because I prefer it to the colleges own desk.

 

In my spare time I also "freelance" for other companies either me and my kit, just my kit or just me, whichever the client wants. I charge the market rate for both myself and my equipment, if anything I'm more expensive than most people in my area (but still within what is "the going rate") and as such I do more freelance work in London than I do in Norfolk. I'm a paid up member of BECTU, and the PSA and have full PLI, a company vehicle and I'm VAT registered.

 

I get paid PAYE by the college because its a "normal" job and the rest of the work I do is self-employed so I fill out a tax return to claim for expenses etc.

 

I do not actively seek work but rely on existing contacts phoning me when they need someone, this is especially true now that work is scarce as unlike most people, thanks to my personal financial situation I do not need to work at all. Despite this my equipment has almost completely paid for itself within six months because I run my business properly.

 

I do feel that it unfair to suggest that anyone who take a PAYE job as well as SE is some kind of job stealing mercenary. HMRC have created this situation by tightening the rules on self eployment, it is now possible to do two jobs for the same client and one of them could be classed as self employment while the other as PAYE. Add to this that a lot of PAYE jobs just simply don't pay enough to live and people have got to take work where it is available.

[JDP]

I am probably going to come across as a red-blooded freelancer here, and maybe a bit rude, but....

 

If someone's personal finance situation is such that they need to seek employment outside their full time job, then either negotiate a pay rise, or get another job. I know in the reality of things, its not as simple as that, but when your freelance 'looking in' it is.

 

At the end of the day, a freelancers personal finance situation is ENTIRELY based on their freelance work, theres no 'safe way' here. This is NOT regardless of any situation in a full timers personal life financially, the way it is if you are full time. Even if your 'personal finance situation' you still have your basic hours or basic salary, we don't.

 

I, to be honest, don't want to hear all about your rates being the same as other 'proper' freelancers. I guess either way for you its catch 22, take less and be seen as undercutting, take more and be seen as greedy....

 

At the end of the day, (unless my colleagues and I are complete exceptions with this opinion) I think if you have a full time job, then stick to that, and leave the 'proper' freelancers to doing that.

 

I don't care much for the fact you pay your taxes and have PLI, if you do, because, when theres VERY experienced, good freelancers out there with no or little work on, its extremely infuriating to see full timers stashing it in for extra cash (as I and others see it) - regardless if your personal financial situation, its irrelevant to freelancers, you are still doing it for EXTRA cash, where as we are doing it FOR cash!! Huge difference.