Self employed stylists/beauticians

[surf girl]

New law states that if u rent a chair, room etc in ur business u must pay vat on it, so from what I can gather the salon is happy for you to rent from them providing you cover the cost of the vat the will be charged, and yes you can work self employed but have set hours etc it's like a building contractor for example they are self employed but the have to been at work every day and have the job done and have to book time off

No that's a sub contractor

 

[surf girl]

Before I give my opinion, I should tell you that before I became a beauty therapist I was a certified accountant working with small businesses for many years.

There are two things I'd like to say. Firstly, I know someone who works for HMRC and they have decided to really focus on clamping down on employers who claim they work with self-employed people rather than employees. It's not just in the hair and beauty industry that it happens, but if I had an accountancy client who told me they had a set-up similar to what has been described by previous posters, I would advise them to think very carefully about the implications of being audited by HMRC which could happen if they believe you are 'fudging' the books.

Secondly, self-employed status is based on Common Law rulings and the following needs to be shown to occur in order for a person to prove they are genuinely self-employed and not just doing so for tax purposes (this is taken directly from the HMRC website):

1. Can they hire someone to do the work or engage helpers at their own expense?
2. Do they risk their own money?
3. Do they provide the main items of equipment they need to do their job, not just the small tools that many employees provide for themselves?
4. Do they agree to do a job for a fixed price regardless of how long the job may take?
5. Can they decide what work to do, how and when to do the work and where to provide the services?
6. Do they regularly work for a number of different people?
7. Do they have to correct unsatisfactory work in their own time and at their own expense?

As an accountant I would also ask the questions:

1. Who keeps hold of the money on a day to day basis?
2. Who does the advertising for the therapist?
3. Are they trading on the back of the name of the salon they are working in, if that salon has a high profile reputation?

Basically, what it comes down to is asking whether the person has complete control over whether their business is a success or failure. If the answer is yes, they are most likely self-employed.

I feel there is a lot of confusion around this area, so please feel free to ask me any tax related questions. I don't like people being taken advantage of, and would be happy to help if I can.

Lucy x

You are very wise owl ☺️

 

[charlie109]

Was just using contractor as an example, I went through all this with my accountant when I decided to rent out a room in my salon. If the participating party agrees to the terms then it's fine

 

[charlie109]

And the 75k threshold is for all earning not profit you could earn 100k a year and spend 80k of it on products and wages etc n only have 20k profit but you will still have to register for vat

 

[the_owl]

New law states that if u rent a chair, room etc in ur business u must pay vat on it, so from what I can gather the salon is happy for you to rent from them providing you cover the cost of the vat the will be charged, and yes you can work self employed but have set hours etc it's like a building contractor for example they are self employed but the have to been at work every day and have the job done and have to book time off

A business is now obligated to CHARGE (rather than pay) VAT on a chair rental in some circumstances (if you're talking about the 2012 Hairdressers' Chair Rental changes). It is up to the business whether they choose to pass this charge on to the chair renter (and therefore increase their rent by 20%) or absorb it themselves and keep the rental amount the same but just take less themselves as profit.

With regards to contractors, there are essentially two types of contracts: a contract for SERVICE i.e. an employment contract, and a contract for SERVICES which is a self-employed worker.

There is a tool on the HMRC website where you can check your employment status if you are not sure if you should be considered employed or self-employed. It only takes two minutes to fill out.

HM Revenue & Customs: Employment Status Indicator

 

[sdsurge]

Well a service charge in a restaurant is not compulsory, you do not have to pay it. If you decide to rent space out within a salon , then charge accordingly. It would be morally wrong to charge rent & commission. You would find yourself with a high turn over of renters, as it would not be a fair deal. When you rent a room within a salon ,your rent is not going to cover the entire running costs of that salon , why should it .

To the first post, you should definitely only charge rent or commission NOT both. Do not be greedy , i would rather have some one long term, to enhance my business, than a constant turn over of new therapists because of impossible rents.

You would be amazed at the amount of responses I have had regarding employment. It is not greed, I have not disclosed my entire business plan on here as that would be foolish. But I can tell you, there are many people out there who seem to like the package I am offering.
We must remember that business is not one size fits all. Different business models work for different people. Again, as I said previously, the vast number of salons going out of business is an indication they are all following the same model.

 

[libbylou]

That is a contradiction in its self, you are not offering employment, you are offering to be some ones landlord. That is very different.

 

[ColourGirly]

I think some posts have now disappeared from here- maybe a reminder to everyone that is visible to the world!

 

[sdsurge]

That is a contradiction in its self, you are not offering employment, you are offering to be some ones landlord. That is very different.

Well the "self-employed" people applying are currently not employed, either by self or anyone else..ummmm?

 

[libbylou]

Well taking advantage of desperate people, is nothing to brag about. If the only replies your having are from the unemployed,then that alone speaks volumes, maybe your offer is not so appealing to the less desperate therapists out there.

 

[Cheshire_Gal]

Well taking advantage of desperate people, is nothing to brag about. If the only replies your having are from the unemployed,then that alone speaks volumes, maybe your offer is not so appealing to the less desperate therapists out there.

I missed what this was about. Can someone paraphrase for me please? x

 

[surf girl]

There are deleted posts on this thread, basically too many people crossing the line with regards to tax evasion, unfair charging of rent and a very blurred line between employment and self employment, the post was regarding someone who uses desperate people who don't understand fully the ins and outs of self employment to their own advantage

 

[ColourGirly]

I can't believe people put this on an open forum and sometimes name their salon!!!

I can see people have even edited their profiles now!

 

[Cheshire_Gal]

There are deleted posts on this thread, basically too many people crossing the line with regards to tax evasion, unfair charging of rent and a very blurred line between employment and self employment, the post was regarding someone who uses desperate people who don't understand fully the ins and outs of self employment to their own advantage

What was unfair about the rent charged please?

 

[princessamie]

What was unfair about the rent charged please?

The person seemed to think that they could charge anything they liked because the people they had working in their salon were desperate for a base and counted themselves 'lucky' to work there.

A few people have quoted the posts, they're still available to see.

The best advice I ever received - "Work smarter, not harder". Thank you, geeks!!

 

[ColourGirly]

It's a very small world lets just say that!

 

[libbylou]

certain posts suggesting , charging room rental plus commission. It was pointed out it was unfair to charge both. If you rent space/room the salon you are renting off is just your landlord, and should have no say in the running of your business. Some posts have been deleted, can not imagine why ? I personally think charging room rent , then wanting to take a % of their takings as well, is unfair to say the least. I honestly think a certain poster is either very deluded or just replying to posts to wind people up. x

 

[surf girl]

Just deluded lol

 

[surf girl]

Funny how all the comments have been removed too? I think someone wishes they hadn't been so "open" now lol

 

[ColourGirly]

The quotes haven't been removed tho!