Tax pain points and planning under the flexible employment model

Mondo Workplace Updated on 2024-02-02

Through flexible employment**, we can find that flexible employment involves labor relations, taxation and other fields. Partnerships are particularly important when it comes to sharing flexible staffing settlement products, as it involves aspects such as corporate VAT and personal tax.

The adoption of flexible employment mode by enterprises is a re-planning of the original business of the enterprise. Through the flexible employment settlement process, the relationship between enterprises, freelancers and tax can be bridged, and finally the four streams can be aligned, thereby helping companies optimize their cost structure.

Next, let's analyze the part of flexible employment that involves paying taxes

Under the flexible employment model, the two parties sign a natural person service agreement instead of an employment contract, and establish a cooperative relationship, which is relatively more flexible.

Enterprises can issue contracts during the business period, and freelancers can also flexibly change jobs after completing the business, which greatly reduces the labor cost of the enterprise. At the same time, freelancers can also increase their income through preferential tax policies.

We can make a brief analysis based on the tax-related pain points of each role in the settlement process:

Enterprise side: 1Business compliance risk: Whether the enterprise has a real flexible employment scenario and whether there is a complete business chain to prove the consistency of the four streams of enterprise taxation, and whether these are verifiable and traceable.

2.Commission settlement problem: due to the high mobility of freelancers and the lack of awareness, enterprises cannot effectively collect freelancers' bills, resulting in the lack of enterprise costs and obvious risks of ticket shortage.

Freelancers:

1.The vast majority of freelancers realize that the whole process is over after completing the task and getting the commission, and they lack personal tax awareness and will not go to the tax department to issue compliance bills.

2.Due to the large differences in age and educational background, freelancers need enterprises to support a variety of payment methods, such as WeChat, Alipay, bank cards, etc.

Taxation: The number of flexible employees is large, the types of work are complicated, most of the practitioners lack tax awareness, and the tax department cannot inform each employee how to pay taxes one by one, which brings great difficulties to tax management.

The above are the tax pain points involved in enterprises, individuals and taxation under the flexible employment model. Therefore, enterprises need to make reasonable planning when adopting flexible employment models.

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