Sub-Contractor VS Contractor

In Australia, a contractor is an individual who works for an organisation on a contractual basis. A contractor’s contract specifies the project or task that needs to be completed by or on behalf of the organisation, as well as any payment terms and conditions.

A sub-contractor is someone who is hired by a contractor to work on one or more specific parts of a larger contracted project. This means they are ultimately working for the same principal – however their contract is with the contractor rather than directly with the principal.

In Australia, contractors are considered independent of the company they are working for and can set their own rates, whereas sub-contractors are paid whatever rate has been agreed between them and the main contractor.

A key difference in taxation between contractors and subcontractors in Australia is that contractors generally pay tax through their own personal income tax returns while subcontractors pay GST through the main contractors invoices.

Finally, contractors typically provide their services in exchange for fees which can include additional benefits such as health insurance or other allowances – however these benefits generally do not apply to subcontractors.

Previous
Previous

How To Track Job Costs For Business Owners: Essential Steps For A Profitable Outcome

Next
Next

What Is The Best Business Structure?