info@wollongongtaxservices.com.au
+61 02 4226 5333
|
Employee |
Contractor |
|
An employee works in the business and
is part of the business.
|
A contractor is running their own
business and provides services to a business.
|
Ability to
sub-contract or delegate:
|
An employee cannot sub-contract or delegate the work - they cannot pay someone else to do the work.
|
A contractor is free to sub-contract
or delegate the work - they can pay someone else to do the work.
|
Basis of
payment:
|
An
employee is paid:
·
for the time worked
·
a price per item
·
or activity a commission.
|
A
contractor is paid for:
·
a result achieved based on the quote
they provided. |
Equipment,
tools and other assets:
|
The business provides all or most of
the equipment, tools and other assets required to complete the
work, or the worker provides all or most of the equipment, tools
and other assets required to complete the work, but the business
provides them with an allowance or reimburses them for the cost
of the equipment, tools and other assets. |
The worker provides all or most of the
equipment, tools and other assets required to complete the work.
The worker does not receive an allowance or reimbursement for
the cost of this equipment, tools and other assets.
|
Commercial risks:
|
An employee takes no commercial risks.
The business is legally responsible for the work performed by
the worker and liable for the cost of rectifying any defect in
the work. |
A contractor takes commercial risks,
and is legally responsible for their work and liable for the
cost of rectifying any defect in their work.
|
Control over
work:
|
The business has the right to direct
the way in which the worker performs their work.
A contractor has freedom in the way the work is done
subject to the specific terms in any contract or agreement.
|
Independence: An employee does not
operate independently from the business. They work within and
are considered part of the business.
A contractor is operating their own business
independently from the business. Services are performed as
specified in the contract or agreement and they are free to
accept or refuse additional work.
|