People Are Not Your Most Important Asset? The Right People Are.
As market leaders in specialised recruitment in South Africa, we continue to enhance the competitive edge of South African businesses by providing access to their greatest asset – Talented People.
Advantages of Working as an Independent Contractor
Independent contractors reap many rewards that regular wage earners may never experience.
You are your own boss.
When you’re an IC, you’re your own boss, with all of the risks and rewards that entails. Most ICs bask in the freedom that comes from being in business for themselves. They would doubtless agree with the following sentiment expressed by one IC: “I can choose how, when, and where to work, for as much or little time as I want. In short, I enjoy working for myself.”
You may earn more than employees.
You can often earn more as an IC than as an employee in someone else’s business. For example, an employee in a public relations firm decided to become an IC when she learned that the firm billed her time out to clients at $125 per hour while only paying her $17 per hour. She charges $75 per hour as an IC and makes a far better living than she ever did as an employee.
According to The Wall Street Journal, ICs are usually paid at least 20% to 40% more per hour than employees performing the same work. Hiring firms can afford to pay ICs more because they don’t have to pay Social Security taxes or unemployment compensation taxes, provide workers’ compensation coverage, or provide employee benefits like health insurance and sick leave. Of course, how much you’re paid is a matter for negotiation between you and your clients. ICs whose skills are in great demand may receive far more than employees doing similar work.
You’ll probably pay lower income taxes.
Being an IC also provides you with many tax benefits that are not available to employees. For example, no federal or state taxes are withheld from your paychecks, as they must be for employees. Instead, ICs have to pay estimated taxes directly to the IRS four times a year. This means you can hold on to your hard-earned money longer before you have to turn it over to the IRS. Moreover, it’s up to you to decide how much estimated tax to pay (but there are penalties if you underpay). This flexibility gives ICs more control over the money they earn. For more information on estimated taxes, see Paying Estimated Taxes. You can also take advantage of many business-related tax deductions that are not available to employees.
When you’re an IC, you can deduct from your taxable income any necessary expenses related to your business, as long as they are reasonable in amount and ordinarily incurred by businesses of your type. This may include, for example, office expenses (including costs associated with a home office), travel expenses, entertainment and meal expenses, cable TV and magazine expenses, equipment and insurance costs, and much more. ICs can also establish tax-advantaged retirement plans such as SEP-IRAs and Keogh Plans. This enables them to shelter a substantial amount of their income until they retire. Because of these tax benefits, ICs often pay less tax than employees who earn similar incomes.
Most complex project implementations require Expert Skill or a Skills Transfer. We offer experienced resources that can be allocated to your site to service this requirement. We guarantee Project Success with expert skills. It allows your organization to build the skills required at your own pace. In many cases our specialized skills are delivered lower than internal rates.