Work done via an invoicing service must be performed within a contractor relationship; work done within an employee relationship cannot be billed for via an invoicing service.
Both parties, the light entrepreneur and the contractor should be aware of the differences between an employment and contractor relationship. You can agree about your assignments orally, in writing or electronically, but we recommend everyone to make a written contract.
A contractor relationship is usually formed when certain key terms and conditions are fulfilled. The Finnish Tax Administration and Finnish Centre for Pensions supervise the boundaries between contractor and employment relationships.
You should be aware that subcontracting is not suitable for all sectors or tasks. An employment relationship cannot be disguised as a contractor relationship.
Key points of a contractor relationship:
- The purpose of the work is to generate income.
- The entrepreneur's risk and responsibilities, which also apply to light entrepreneurs.
- The right to decide when work is done (irregular working hours).
- There is no direct 'right to manage', comparable to an employment relationship, between the client and contract worker.
- An entrepreneur or light entrepreneur can have several clients.
- A contractor relationship is agreed between the parties.
The above mentioned points don't have to coincide simultaneously. The essential thing is that the entrepreneur works independently for their own benefit and not under supervision by the employer. If these terms are by and large fulfilled, a contractor relationship is formed.
What is the role of UKKO.fi?
UKKO.fi handles the payments traffic according to its terms and conditions between the User and the client, based on the agreement between these parties. UKKO.fi handles the payment to the user which is based on the invoice created by the user, according to the directives set by the Tax Authority. The User negotiates the work and prices with their client. There is no employment relationship as defined by the Employments Contracts Act between UKKO Yrittäjyyspalvelut Oy/UKKO.fi and the User.