[shelton]

This question has come up time and again, but I for one have never really seen a consensus of opinion voiced.  That may be because there isn't a 'better' way of doing it ...

Question is . . . for a small company like us, taking on staff as employees is a bit daunting - due to holiday pay, maternity pay, sick pay, etc, etc. . .  we just don't have the margins to cope with with this.

I've seen the idea of using self-employed staff - effectively subbing it out - floated in the past.  They are obviously then responsible for their own tax, etc.

Is this a viable solution or should I just speak to my accountant and get the payroll sorted properly?

Any advice greatly appreciated.

Shelly.

[mxg]

Be careful about the self employed route.

It doesn't really matter what you think/call it, at the end of the day the tax man can/will decide if somebody is self employed or not. They will look at things like do they work for anybody else, who decides when/where they work, who provides the equipment. So obviously the less control of their destiny somebody has, the less chance there is that they are really "self employed"

Your rates should always assume that you are going to be paying somebody else to do the work or else this is the problem that you hit.  Depending on how big/small your customer base is you might be happy to increase their rate gradually but for all new customers hike it up to where it should be - and what that is depends on your locations/competition etc

The tax man also has a team called the Business Support Unit that run very useful and FREE courses on all of these subjects - setting up a payroll, starters and leavers, sick/maternity/paternity etc. They run all over the country . Check their website.

It gets easier after a while. I was in your position about 2 years ago. It can only be a good sign and if you want a business rather than a job its a step you are going to have to take

Mick

[Emma Lou]

It doesn't really matter what you think/call it, at the end of the day the tax man can/will decide if somebody is self employed or not. They will look at things like do they work for anybody else, who decides when/where they work, who provides the equipment. So obviously the less control of their destiny somebody has, the less chance there is that they are really "self employed"

Hi Shelton,

As MXG said this is true, I had this experience myself a few years ago in a business I had.  The self employed person never paid their taxes and after 3 years of this (when I got called by the tax man) I had to pay the lot up. This may not be relevant but I thought it may be worth mentioning to you.  I know it doesn't help you out much!

Emma

[Paul Heath]

What you are going through we went though this at the begining of the year. I can honestly say the "tax man" helplines are very good.I even managed to do the return on line and get the tax free payment (they don't actually cough up they give you a credit against future payments) We now have six employed staff and are advertising for more. Its harder to find good honest staff then deal with the tax man. At the end of the day i go to sleep at night not worrying about the HMRC people knocking on the door. Once you get the hang of it, its really not that bad. To do the payroll i have signed up with www.moneysoft.co.uk. what took me a couple of hours on spreadsheets i had put together now take 15mins. Best of Luck

[Jan K]

basically if you have a cleaner that works for a client of yours on a regular basis, they are classed as your employee and you are liable for all their PAYE contributions and also employers' liability insurance for them