Working through SymbionHR as an employee
One of the most common ways we work with professional contractors is under an employee, or PAYG, engagement model.
This means SymbionHR becomes your legal employer for the duration of the assignment, regardless of length. Consequently we cover you for all employment related insurances, including workers compensation, public liability and professional indemnity, and remit all insurances and statutory obligations. Under this model you are also entitled to access our discounted partner offers and we can arrange salary packaging and more complex payroll benefits, such as living away from home allowance.
At the end of the financial year, we will send you a payment summary and allow you to access to our discounted third-party accountant services, should you wish to utilise them.
In such scenarios SymbionHR will sign an employment agreement with you, the worker, and a client agreement with your nominated host employer. We will invoice them on agreed rates and terms for the details of work performed during the payroll cycle.
Depending on the arrangement negotiated with the client, SymbionHR will either remit funds once received from the client organisation, or remit funds under a finance arrangement.
Many professionals now work directly with us to avoid having to navigate the complexity of tax and employment legislation and lower the costs of their casual/contract engagement.
FAQ: Why not work under my own company structure?
A common misconception that still exists is the idea that an individual working as a sole trader or through a proprietary limited company structure allows more tax effective options. Unfortunately, in many cases, this is far from the reality and often leads to increased costs and large tax bills at year end.
Personal Service Income (PSI) legislation specifically deals with sole traders or companies whose majority business is the provision of the skills, knowledge and expertise of the individual(s) engaged. In effect, if the payments made to the sole trader or company are deemed to be PSI, the government expects those payments to be taxed in the same method as wages. If the payments have not been treated as such, you will be expected to pay the difference to the ATO at the end of the year, which can amount to tens of thousands of dollars
To quote the ATO website:
‘Many consultants and contractors operate their business through a company, partnership or trust. In many cases, the income received for the work they do may be classified as PSI’. This is an important point for those individual contractors working through their own companies.
This means that by running your engagement through your own structure, you may end up with more total cost and negligible benefit, especially if the work performed is intermittent. Just think, you need to submit 2 x tax returns (1 for Structure and a Personal Tax Return), administration (billing, chasing monies, remitting taxes, superannuation, etc), paying for employment insurances, software, home office expenses, etc.
Working through SymbionHR allows us to alleviate those burdens and reduce engagement costs. We allow you more free time and give you confidence you are working with industry professionals who are chasing the most tax effective engagement methods for you.
Feel free to Contact Us to discuss further, check out our Resources page for further information, or click on the links below.
