Determine the status of workers

The status of your workers for tax purposes is important, as employees and contract workers involve different obligations.

An employee is a worker you employ in your business - you generally have to withhold tax from payments you make to them.

A contract worker is a worker who is self-employed and has a contract with you to provide services. You don't have to withhold tax from payments to them, unless you enter into a voluntary agreement with them.

What to do...

Go to the Tax Office website to help you determine if your workers are employees or contract workers.
Use the Employer obligations checklist to find out what you need to do when a new worker starts, during employment or when a worker leaves.
Find out if an apprentice is an employee.
Read about voluntary agreements with contract workers.