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I have the choice of PAYE or being self employed in the same job, which is best?

(10 Posts)
HeyNonnyMaybe Sun 24-Jan-16 15:53:54

I've been offered some work of an indefinite duration. It's a small company, I know the owner. I can either go on the payroll as PAYE or invoice her. I can't work out which is the best option. Important factors for consideration are:

I am going to be applying to be added to the mortgage and deeds of a house in about 5 months time. I'm guessing being 'employed' will be better for this scenario.

In about 8 months - 12 months we may be moving to a different part of the country, and I will be self employed there. We will rent at first, but then apply for a mortgage. I'm guessing at that point it would be beneficial if I can 'prove' a longer track record of self employed income, therefore being self employed in this new job would help.

chocoshopoholic Sun 24-Jan-16 15:58:58

HMRC has an employment status tool www.gov.uk/guidance/employment-status-indicator which will show how they would consider you.

HeyNonnyMaybe Sun 24-Jan-16 16:08:04

Sorry, should have been clearer. The reason I can choose is because there is a lot of flexibility, I can pretty much work whenever I want. It's not one of those cases where an employer wants someone to do the same hours every day but is insisting they're self employed.

My question really relates to how it will affect the mortgage side of things.

Purplehonesty Sun 24-Jan-16 16:39:09

Mortgage wise you would be better off as employed.
Otherwise the lender will want to see full years accounts which you may not have

HeyNonnyMaybe Sun 24-Jan-16 17:06:59

I'll have plenty of years of accounts as I've been registered self employed for years. The issue I can't resolve is what will look best in 18 months time when I am solely self employed, a period now of being employed, or a period now of being self employed. Or indeed whether it doesn't matter and they just look at the bottom line.

N3wYear2016 Sun 24-Jan-16 18:18:56

If you are PAYE would you receive other benefits automaticaly as part of your package ?
Each company will have its own package opions
eg
Pension - company matches what you pay in
Holiday
Sick pay
Child care vouchers
Death in service
Free health care
Reduced services eg car lease
Option to buy shares
Flexible working
etc

versus self employment

TalkinPeace Sun 24-Jan-16 21:29:05

Small companies tend not to have much in the way of "package"

if your self employment records will let you get a place when you move, stick with that
BUT
be careful of the "badges of self employment"

HeyNonnyMaybe Mon 25-Jan-16 06:41:46

Yes, there's zero 'package'. I'll turn up, work, get paid and come home again. grin

Talkin, can you explain why you think I should go for self employed, apart from the deductable expenditure angle? What are "the badges of self employment"?

dynevoran Mon 25-Jan-16 07:08:19

The badges of self employment are a series of tests derived from case law over many years which look at your situation and determine if you are employed or self employed. You can't choose! It is determined on the facts!

HeyNonnyMaybe Wed 27-Jan-16 06:54:34

Ah, I see, thanks!

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