Self Employed


Self-employed workers are not protected under employment law and are unprotected by the employer’s compulsory insurance against industrial injuries.

You will generally be an employee, and not self-employed, if the economic reality of the relationship is that you are not in business on your own account, or in ordinary language, ‘Are you your own boss?’

Unless you genuinely want to go into business on your own account, taking the risks inherent in such a practice, you should resist offers to become self-employed. Remember that even if your employer calls you self-employed and you are self-employed for tax and National Insurance purposes, you may be found to be an employee for the purposes of employment protection if you claim unfair dismissal or other statutory rights.

As a self-employed person you may be able to claim benefits or tax credits, depending on your income and other circumstances.

You will also be responsible for paying income tax on your earnings and will usually need the help of an accountant. There are special tax reliefs and allowances which self-employed people can claim. If you are newly self-employed, you should register with HM Revenue and Customs (HMRC) by calling the helpline for the Newly Self-Employed. The helpline number is: 08459 154515.

You may have to pay national insurance contributions. Whether you have to pay contributions for yourself, and if so what type, depends on how much you earn.

If you employ other people you will be responsible for paying wages, tax, national insurance contributions and Working Tax Credit where relevant. You will also have to meet the requirements of employment law and health and safety regulations.

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