What is Self Employment?
In most cases it is clear whether a person is an employee or is self employed. However, sometimes it is not so clear whether a person is self employed. There are a number of key criteria to take into account in deciding whether a person has been appropriately classified as self employed. The most important test is the economic one, ie whether the person who is working 'does so in business on their own account'. Is the person a free agent with an economic independence of the person engaging the service?
No one factor is conclusive on its own but the factors that decide whether a person is self employed are:
- Owns the business
- Exposed to financial risk
- Responsible for investment and management
- Opportunity to profit
- Has control over work done
- Can hire people on own terms
- Provides equipment, tools and machinery
- Has a fixed place of business
- Costs and agrees a price
- Provides own public liability insurance
- Controls own hours of work
Other considerations include:
Being registered for VAT and Self Assessment is not conclusive of self employment. A person can be self employed in one job and an employee for another position.
If a person is unsure as to whether they have appropriately been deemed self employed, they can contact either The Scope section of the Department of Social Protection or Revenue .
The Scope section or Revenue will make a determination, taking into account the factors outlined above whether a person was appropriately classified as self employed.
