c Super trap! Do you deduct superannuation from your 'Contractor' payments?12-Jun-2014 Employee / Contractor decision tool. Who does the work?
Some major conference industry suppliers have been screwed by the ATO in the last twelve months.
Millions of dollars have had to be paid in fines and that money has then got to be claimed back by the supposed contractor. If they don't Julia keeps the dosh.
Many companies believe that because they hire someone on a contract by contract basis they need only pay the agreed sum and have no further worries.
Not so according to the ATO!
There is an excellent tool which tells you whether the ATO deems your contractor to be an employee or contractor.
A simple Q & A follows and in the end you will be deducting the 'employees' superannuation and, if not, perhaps paying it direct to Julia.
PM Julia Gillard has not helped with her personally framed and much vaunted "Fair Work Act" - "Justice Bromberg went through the history of tests used to differentiate independent contractors and employees in some detail, noting that:“the absence of a simple and clear definition which explains the distinction between an employee and an independent contractor is problematic…..… Workers and those who employ or engage them require more clarity from the law. That is particularly so when important legislation such as the Fair Work Act ….have steadfastly avoided defining what is an employee, yet demand (on pain of civil penalty) that there be no misrepresentation as to the nature of the work relationship…...”"
We were very surprised by this - broadly speaking unless you hire a company with an ACN, a trust or a partnership you are liable for the super. Here's the twist - the contractor's (or employee's) ABN is irrelevant.
Good luck! Over to you."...you told me and I forgot, you showed me and I saw, you involved me and I remembered."
be sure. BRAMSHAW 1800 507 557