Good deal or not? Comparing hourly-wage with private trader

[tiliavain]

Dear members,

I need some help to compare two job scenarios.They are not actually options, but I've working under both arrangements and I still don't know how good they really are.


1) Hourly-wage contract. 18 € per hour plus 9% vacation rights. I've been told the health care was a good one.

2) Working as a private trader. Hourly wage: 26€

Q1) So, if I work for a year, which option sounds better?

and

Q2) How do I compare both options?

and

Q3) What's would be equivalent of a "normal" salary compared to the 26 euro/hour private trader?

[Rosamunda]

I would say that is about right (ie they are about the same).

But you need to take into account the hassle of doing all the bookkeeping (which can be time-consuming) and such things as union membership etc. With a toiminimi there are some variables, eg I think unemployment cover is elective (filecore knows better than I do).

If you do have good health insurance with your current status then if I were you I would probably stay put.

The only real advantage of being a private trader is that you can invoice multiple clients and look for work in different places (even work with oversees clients etc). But if you are working 100% with the one employer then I don't see the point of changing.

Are you teaching by any chance?

[tiliavain]

Thank you. I have insurance but not for a long time.

Do you know how can I calculate it?

But you're right, I registered as a private trader because I needed to invoice for other businesses abroad. Given that my future is a bit uncertain in the next couple of years I might continue under this arrangement. The worst part for me is putting apart some money so that I can have a good 4 or 5 week vacation next summer...

[Upphew]

But if you are working 100% with the one employer then I don't see the point of changing.

Taxman starts to get ideas of tax evasion if you do so. So much that they might decide you aren't entrepreneur, but just a plain old worker (that is being ripped of or trying to rip off taxman).

[Rosamunda]

Upphew... if you have a toiminimi the tax rates are EXACTLY the same as for personal taxation. It makes no difference if you have one or 50 clients. Just as a private individual can have a "freelance" tax card which enables him to be salaried with more than one employer at the same tax rate.

There is no evasion or even avoidance here.

[inkku]

Did you include pension contributions? That is 1,5% iirc.

[tiliavain]

Are you teaching by any chance?

No, I'm working with IT. Do you want to hire me?

[tiliavain]

Upphew... if you have a toiminimi the tax rates are EXACTLY the same as for personal taxation. It makes no difference if you have one or 50 clients. Just as a private individual can have a "freelance" tax card which enables him to be salaried with more than one employer at the same tax rate.

There is no evasion or even avoidance here.

I think what he was trying to say is that if you keeping working for a single company you might ran into a situation which can caracterized as a regular employment, instead of a free-lancer or contractor. I don't know the proper terms in English, but do you get my point?

[Rosamunda]

Yes, this is quite common here. I know what he means. But it is not tax evasion (which is what he was suggesting) since you are still paying income tax at the same rates as a salaried employee.

[Upphew]

Yes, this is quite common here. I know what he means. But it is not tax evasion (which is what he was suggesting) since you are still paying income tax at the same rates as a salaried employee.

But the employer is avoiding taxes...

[Rosamunda]

Ah yes! Probably

[Upphew]

Q3) What's would be equivalent of a "normal" salary compared to the 26 euro/hour private trader?

Some people say that to earn as much as employee making 2000e/month (before taxes) you should have billing of 4000e+VAT/month.

[tiliavain]

I don't think that's accurate, if you have some calculations feel free to send me.

[Cathy Duncan]

Dear members,

I need some help to compare two job scenarios.They are not actually options, but I've working under both arrangements and I still don't know how good they really are.


1) Hourly-wage contract. 18 € per hour plus 9% vacation rights. I've been told the health care was a good one.

2) Working as a private trader. Hourly wage: 26€

Q1) So, if I work for a year, which option sounds better?

and

Q2) How do I compare both options?

and

Q3) What's would be equivalent of a "normal" salary compared to the 26 euro/hour private trader?

Well, i think the better option is 18 €/hour that offers 9% vacation rights, because you may also fell ill, so this way, you'l feel secured.

[Upphew]

I don't think that's accurate, if you have some calculations feel free to send me.

Absolutely it is not accurate, it depends so much what you do. Rent a office and lease a car, pay for advertising, pay for tools, pay for pension, pay for someone to do your work when you get sick... it all adds up. And then you end up with car and office and tools but can't get customers to pay...