Employee V Self-Employed

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Be careful when hiring people that you are aware that Revenue has a clear distinction between an employee and someone who is self-employed. One of the biggest things to note is you are liable for employers PRSI when someone is regarded as an employee.

When is someone an employee in Ireland?

The main points from revenue to note are:

  1. Someone else directs their work and how it is performed
  2. Supplies labour only
  3. Does not supply materials for the job
  4. Is not exposed to personal financial risk
  5. Works for one person or one business

When is someone self-employed

The main points to note are:

  1. Business owner
  2. Exposed to person financial risk
  3. Supplies materials for the job
  4. Has control over what is done
  5. Can provide the same service for multiple people / businesses at the same time
  6. Provides their own insurance

Examples

  1. This is why contractors are often required to setup an umbrella company so they are regarded as being self-employed
  2. A full time childminder working in your home is an employee. A childminder who works in their own home is self-employed.

If you would like detailed information please click here.

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