Employment Income: Scope |
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Under this test there is no contract of service if the worker can say no—ie there is no obligation on the worker to accept an invitation to provide services. This last test has been used as the basis of much planning by employers anxious to get an arrangement treated as one for services and not of service. In labour law some workers rendering services under a contract for services are brought within the employment protection category by legislative redefinition.33 Some cases have mixed all the elements in these different tests.34 |
Another test asks whether those performing the services are in business on their own account.35 It is open to a fact-finding tribunal to conclude that a person is in business on his own account when all that he provides are personal services.36 It is equally open to a fact-finding tribunal to conclude that a person is in business on her own account even though there is what purports to be a written contract of employment.37 By contrast, a person under contract to provide clerking services to a set of barristers’ chambers was held to be an independent contractor on the particular facts.38 |
Finally some miscellaneous points. If no services are to be performed, the contract is not one of employment.39 North Sea divers are expressly excluded from schedule E if taxed under schedule D, case I by TA 1988 section 314 instead.40 A person employed by a company is an employee of the company. Where a man held himself out to be an employee of a company which he controlled and created, the question whether he was such an employee or a self-employed person was treated as a question of fact.41 |
The fact that the contract is illegal cannot, of itself, convert an employee into a self-employed person. The status of contracts of employment which are illegal has not been explored in the tax context.42 |