Subcontractors and tax

[Tim Watkiss]

Hello everyone I have just had my napit assessment today and passed with flying colors I work as a maintenance spark full time but am going to do some installation work in my spare time as I have a lot of rest days, I am from an installation background originally. I was wondering if anyone could enlighten me as to whether I could use a labourer to help me with big jobs such as rewires on a casual basis and how I would put this through my books particularly if the labourer was not self employed themselves, would I have to pay tax on the full bill and then pay them out of what's left? I am not used to self employed tax arrangements.

 

[Dustydazzler]

Cash is king

 

[davesparks]

The simple solution is to find a labourer who is self employed.

If they are not self employed then you'll have to employ them, pay them, deduct tax and NI, provide a pension, pay holiday and sick pay etc etc

 

[Tim Watkiss]

Cheers for the feedback guys pretty much as I thought, so if they were self employed they would just issue my an invoice for some labour then I take it?

 

[Deleted member 26818]

The wages you pay out (however you do it), would be an expense so you wouldn’t pay tax on them.

 

[JK-Electrical]

I'd advise you to familiarise yourself with CIS:

Construction Industry Scheme (CIS)

What the Construction Industry Scheme (CIS) is, work covered by the scheme and find out whether you should register as a contractor or subcontractor.

www.gov.uk

 

[Nigel]

You need the consider IR35. If said labourer is working for you as a PAYE person would but you are paying them on a SE basis HMRC will come after you both for tax avoidance and interest.