Accounting and taxation Essay Example | Topics and Well Written Essays - 1000 words

Accounting and taxation - Essay ExampleThe employment status of an employee has been categorized as employed or self-employed.This categorization is based upon the basis and conditions of the relevant association.It is important to mention that such classification is important as separate rules have been promulgated which are applicable to specific conditions of employment in special circumstances. It is important for an employee to realise that he/she should be aware of her job description along with lists of the designated authorities to whom he/she is responsible. It is signifi fuckingt to evaluate the capacity of your designation, which shall be verified against the standard classification of employed or self-employed, it is important to know whether you are doing for that person in an employed capacity or in a self-employed capacity as an independent amazeor. This classification is signifi give noticet in terms of imposition of tax bracket, the employment status is pivotal t o determine the charge to tax on income from that employment or self-employment, and determines the class of NICs, which are to be paid (Helen, 2000).The differentiation betwixt the self-employed and employed is executable after evaluation of contract of service or under a contract for services. It is important with reference to tax and NIC that there is no statutory definition of a contract of service or of a contract for services, it is indeed the relationship towards the institution which is significant in assessment. The application of commonalty law principles is critical for the determination of the nature of a get together. The courts have developed specific factors and assessment, the affirmative response towards series of factors helps in the classification of employed personnel. The questions includes, do they have to do the work themselves can someone tell them at any time what to do, where to carry out the work or when and how to do it can they work a set amount of h ours can someone move them from task to task are they paid by the hour, week, or month can they get overtime pay or bonus payment. The affirmative response towards following suggest the strong possibility of self-employed personnel, can they take on someone to do the work or engage helpers at their own disbursement do they risk their own money do they provide the briny items of equipment they need to do their job, not just the small tools that many employees provide for themselves do they agree to do a job for a fixed scathe regardless of how long the job may take can they decide what work to do, how and when to do the work and where to provide the services do they regularly work for a number of different people do they have to correct unsatisfactory work in their own time and at their own expense (Helen, 2000). As per legal regulations, contract has been regarded as oral and/or implied agreement between minimum two parties. The common elements of valid contract service and contr act for services include, the intention to enter into legal relations an offer (usually of work) and its acceptance (an agreement) consideration (for example, in return for performing work the worker receives payment). The establishment of contact is essential, it is also important to settle the terms and conditions of the contract against case law laid down by the courts over the years (Greg, 2006). IssuesThe legal requirement envisaged by the courts include basic approach to identify the factors present weigh those that point to self-employment against those that point the other way and then stand back and consider the go through that emerges (Helen, 2000). The contract shall include the discussed features, which shall essentially reflect the nature of employment and will assist in differentiation of employment status. The understanding and interpretation of relationship between the parties is not of significant interest, it is the reality of the relationship that matters, the in tention of the parties has to be taken into account and can be decisive where the relationship is ambiguous