(NC) The gig economy boom has provided many of us with a source of income; whether it’s for one-off jobs, freelance contracts, a side hustle or primary employment. If you’re self-employed or a gig worker, keep in mind three key things about the challenges and tax considerations associated with this type of work.
Flexible work doesn’t benefit everyone equally. Being a gig worker means you can create your work schedule. But it also means you will have to look for your next job, and with an increase in gig workers, there’s now more competition than ever. Some jobs have lower pay rates than others, and it can create a less secure source of income, which means you might need to work longer hours than full-time employment to earn enough to get by.
Lack of employment rights and job security. It can be difficult to feel secure as there are currently none of the employment rights or contracts for gig workers that people with traditional jobs receive. Healthcare benefits, time off and paid vacation time are all things that impact gig workers, and any company downsizing can leave them instantly jobless given their temporary status.
Tax responsibilities are on you. Being self-employed means you must keep track of your income and taxes, which are not automatically deducted from each paycheque. It will be up to you to pay taxes to the government on income, you earn, as well as keep track of any business expenses to reduce your taxes. There’s much more responsibility working in the gig economy when tax time comes. Staying organized and keeping track of all income and expenses is key.