Differences Between Employee and Independent Contractor
There are two different types of workers, one being an employee and the other being an independent contractor. Anyone starting a business for the first time may not be aware of the types of workers. Note that the two types of workers have differences that you should know of. Besides differences, examine the advantages and disadvantages of each type. Make sure you read the study below to discover the difference between independent contractors and employees.
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. The only problem is that the employees are given payroll taxes, learn more.
Another difference between an employee and an independent contractor is that the employee is given a consistent salary. Any employee is a permanent asset of any business or company, and this makes them eligible for things like a healthcare plan. Among the packages that they enjoy include; specialized training, severance package, and workers’ compensation.
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.
As compared to an employee, an independent contractor best suits those that want freedom. Freedom maybe the advantage, but the disadvantage is that you will have more responsibility as an independent contractor. 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. As an independent contractor, you will only receive a paycheck once the given project is done. You will get the agreed amount so long as you deliver good work.
The difference between an independent contractor and an employee is that the independent contractor is not entitled to benefits like the healthcare plan. A company may benefit from having an independent contractor, but in this case, as an independent contractor, you will be missing out. In closing, for anyone starting a business or joining any company, make sure you spend time weighing the advantages and disadvantages of an employee and independent contractor so that you make a suitable choice.