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Home Employers employment law
Introducing our legal service PDF Print E-mail

Your annual subscription to Stafftax entitles you to unlimited use of our Legal Advice help-line. We encourage you to make as much use of this service as you need to manage your domestic employment relations effectively. If you require clarification or advice about any employment issue, other than payroll, then please call or email the Legal Advice helpline.

The Legal Advice helpline is available to you as an employer and is not available to your employee as this may cause a conflict of interest. However, if you wish to make an enquiry to assist your employee, you may call on their behalf.

What we do
Rather than simply explain what you can and cannot do, our legal team work closely with you and focus on finding solutions to your particular situation and problem. We accept and reply to email enquires and will also offer help with drafting letters (should you require it) at no additional charge to you.

Additionally, should you find yourself in a particularly difficult situation and need more help or support over and above that provided by your subscription, we can arrange for you to meet with a member of the legal team in person and for a special member’s rate they can help resolve the matter directly.

 

employment guide

Can domestic staff be self-employed?

"Can't I just ask my employee to sort out their own tax?" this is a question we're frequently asked by potential employers. Whether someone is employed or self-employed depends on the terms and conditions of their work. It is important for all employees to know their employment status as it affects employment and benefit rights, and how to pay tax and National Insurance Contributions.

It is equally important that you, as the employer, are absolutely certain whether it is your responsibility or theirs to declare tax and NI.

How to determine employment status
A worker is probably considered employed if they:

  • have to do the work themselves
  • can be told at any time what to do, where to carry out the work or when and how to do it
  • work a set number of hours
  • can be moved from task to task
  • are paid by the hour, week or month
  • can be paid overtime or receive bonus payments

A worker is probably considered self-employed if they:

  • can hire someone else to do their work or engage helpers at their own expense
  • risk their own money
  • provide the main items of equipment needed to do their job, not just the small tools that many employees provide for themselves
  • agree to do a job for a fixed price regardless of how long the job may take
  • can decide what work to do, how and when to do the work and where to provide the services
  • regularly work for a number of people
  • have to correct unsatisfactory work in their own time and at their own expense

*Please note that these lists are not exhaustive.

The exception to the rule
It is clear to see that in most cases domestic employees do not meet HMRC's criteria for self-employment.

However in some cases HMRC do grant self-employment status to domestic workers. It is very important to remember that if you take on domestic staff who was previously self-employed they should contact the Revenue and request confirmation in writing that their status still applies in the new position.

Transfer of self-employment status between jobs is not automatic, and each situation should be considered individually. This is the employer's responsibility, and if they do not receive written confirmation from the Revenue and it later comes to light that the worker is not self-employed, then it is the employer, not the worker, who will pursued for unpaid taxes. And in the eyes of the law it is a criminal offence not to declare an employee and pay tax and NI contributions on their behalf.

employment costs

Always agree a gross wage with your employee

Employers often agree a net (i.e. take-home) wage with their employee, but in reality they are always paid a gross salary, with tax and National Insurance Contributions deducted and paid to HMRC on a quarterly basis by the employer. Although many domestic employers tend to look on this as an additional cost, it is actually part of the employee's gross wage.

If you agree a fixed net wage you are committing yourself to paying all of your employee’s income tax and NI to make up their gross wage, irrespective of their individual tax code or tax position.

Please also be aware that a gross wage is not the total cost to you as an employer. In addition to this you have to pay an Employer’s National Insurance Contribution, which is not part of the employee’s gross wage. This extra sum will be advised to you when we send your first payslip for your employee.