And for our Independent Contractors!
Many of our members are independent contractors and some are super savvy with a business head and are all over how they fit within the system. But many aren’t, so here are some tips to making sure that this is the best option for you.
First and most importantly, visit https://www.fairwork.gov.au/find-help-for/independent-contractors it is a great, concise guide for you to look at to assess whether you fit into the Independent Contractor mould and some of the things you need to do.
A couple of quick points that seem to be getting missed, or confused are:
Tax – you will need to pay both income tax AND GST*. If you are not doing this, the ATO will absolutely retrospectively charge you, possibly also including interest and even a fine – ignorance is not a defence. The upside is that you can also claim GST on your business expenses.
Super – my advice is get advice from the ATO. Straight from www.fairwork.gov.au it says that Independent Contractors pay their own superannuation, unless they hired wholly or principally for the purposes of labour, in which case they are considered employees for superannuation purposes. Get advice.
*Note: there is a turnover threshold above which you must pay GST. If your turnover is lower than the threshold you may choose to be registered, but do not have to.
Should you even be an Independent Contractor?
When it works for both parties, working as an independent contractor can be a great employment opportunity.
Both worker and employer both need to be aware that you CAN NOT make someone be a contractor, or make someone employ you as a contractor.
If you have been forced or coerced into being a contractor, this is called Sham Contracting, seek advice as this is not appropriate business practise.
Equally, Fairwork and the ATO do not care if you want to be a contractor, so your workplace may do a review and it be determined that you should in fact be an employee. In this case, it is inappropriate for them to continue employing you as a contractor.
Fairwork and the ATO have fabulous resources to guide you through any questions you may have – and of course talk to your studio owners as it can affect you both!
Director at the Pilates Centre, Canberra