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Thursday, 29 July 2010 |
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Contractor's legal guide - taxation issues
Thursday, 19 June 2003
Taxation is complex and beyond the scope of these notes. The application of the tax laws varies widely from case to case and seems, in Australia, at least, to be in a continual state of flux.
The main difference from a taxation point of view are:
(a) The obligation to deduct PAYG tax from any payments to employees;
(b) Whether or not GST is payable;
The following indicators can, as at the date of these notes, be used to determine whether a worker is a independent contractor or an employee:
(a) The contract is for a given result;
(b) The worker bears the risk of commercial loss or profit;
(c) The worker provides their own assets and equipment;
(d) The worker sets their own hours of work;
(e) The contract does not contain leave provisions; and
(f) There is unlimited power of delegation.
(g) 80/20 Rule.
Please note that there are just factors which may be considered. Simply because you comply with one or two elements of the above list does not mean that you are independent contractor.
This information is provided courtesy of White SW Computer Law
White SW Computer Law (wcl@computerlaw.com.au)
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