Differences Between Employee and Independent Contractor
A worker can be categorized into two categories, the first category being an employee and the other independent contractor. When you want to start a business, you may not be in the know. If you are thinking of venturing into a business, you should know that there are distinctions between employees and independent contractors. Apart from variances, see to it that you know the benefits and demerits of an independent contractor and employee, click this website. The following paragraphs will highlight the key distinctions between the two types of workers.
First and foremost, it should clear that an essential factor you can use to tell the difference between an employee and an independent contractor is through looking at the tax situation. With an employee, the benefit comes in place by the fact that the employer handles the brunt of tax-related documents. On the other side is that employees are given payroll taxes, and that is a demerit.
An employee differs from an independent contractor in that an employee I was given a consistent wage. The fact still remains that the employees will be recognized and the permanent assets of the employee and therefore have specific benefits like the healthcare plan. Among the packages that they enjoy include; specialized training, severance package, and workers' compensation.
More often, an employee is subjected to a tight work schedule suggested by the employer. This can be a good or a bad thing depending on an individual, discover more. The set schedule may be limiting you in many ways; however, know that through that, you can be more productive.
As compared to an employee, an independent contractor best suits those that want freedom. Despite the freedom, the challenge is that being an independent contractor requires more responsibility. The stress kicks in when you are fully responsible for your tax paperwork, view here.
Note that an independent contractor is considered self-employed by the internal revenue services. The other variance between an independent contractor and an employee is that an independent contractor gets paid only when the task is completed, click here. You have the assurance of getting the full amount so long as the work is approved.
As contrary to an employee, an independent contractor will not get some benefits like healthcare, view here for more. A company may benefit from having an independent contractor, but in this case, as an independent contractor, you will be missing out. To sum up, as an entrepreneur thinking of s starting a business or someone looking forward to joining a workforce, make sure you have a clear understanding and differences between the two types of workers.