Key Distinctions Between an Employee and an Independent Contractor
A worker can be categorized into two categories, the first category being an employee and the other independent contractor. As a young entrepreneur thinking of your own business, you may not be in a place to know this information. In the event that you are joining staff somewhere or starting your own business, you should note that the types of workers have many variances. Besides differences, examine the advantages and disadvantages of each type. Continue reading to discover how employees differ from independent contractors, click here! .
To start with, one of the best ways you can differentiate the two types of workers is by looking at their tax situation. The main advantage that an employee has is that the employer takes care of the brunt of paperwork related to taxes. On the contrary, the disadvantage is that the employees are given payroll taxes.
As compared to an independent contractor, an employee is paid a consistent wage. The employees are also considered as the permanent assets of the company, and in most cases, they will receive benefits such as the healthcare plan. As an employee to get to gain more advantages such as the severance package, workers compensation, and special training.
When it comes to employees, there is always has a strict work schedule dictated by the employer. While the statement seems disadvantageous, it also has benefits depending on the employee, check this site. It is undefinable that a set schedule can be constricting, nevertheless if you thrive on accountability, you can be more productive, find more info.
An independent contractor is a better option, especially if you want to have more freedom. Nevertheless, it demands that you be more responsible, click for more. The advantage is that an independent contractor carries the burden of tax papers on their shoulder, and this can be a pain in the back.
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 much as the employee has essential benefits like a healthcare plan, an independent contractor does not get to enjoy such benefits. As an employer, this can be a burden taken off your shoulders, but when you want to join the staff, you may be disadvantaged read more about these here. 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.