Hi,

I would like to know what are the pros and cons of working as a freelancer.

I started working recently and my company offered a freelancer agreement saying that we need not pay taxes and all we have to do is to show our expenses in contrast to our income and we get refund from the Government. Moreover it does not cover health insurance or vacation expenses.

My husband is in an IT company and we have a kindergarten age child,what would be the pros and cons of this type of contract since my boss also offered me that I could take a permanent contract after 3 months.

Please advise ! Thanks in advance.
NA

You really made me laugh out loud :-)

You *do* and *will* pay taxes, that's for sure, if it wasn't the case, everybody would have been a freelancer...

First on each invoice you do, you have to take out the 19% of Mwst out and send it to Finanzamt, on the first year, it has to be done monthly, after, it depends. Second at the end of the fiscal year, you will have to pay taxes according to your revenues during the year and how much you gain and this part is the most gruesome part. Just let me tell you that I had to pay ca. 25K for 2006 and then had to pay another 25K 2 months after as an "advance" for 2007 so nearly 50K in less than a quarter. So... you definitely will pay :-)

D.

I was just passing by... BTW Just in case, I'm officially a consultant-freelancer-company owner since 2006

Pros:
1) You earn good amount. You get paid for the hours worked.
2) You are your own boss. You can work for as much as you want. You can work in more than one place.
3) You can sign contracts and employ employees. This is bit risky, unless you have insurance.

cons:
1) NO Job security. You can be fired anytime.
2) You have to bear the expenses of monthly accounting, taxation, payment of VAT, insurance etc.
3) You can be sued incase you make some mistakes. Here better take insurance.

BTW, i am freelance since a year and i feel very comfortable in this way. u have to evaluate your options.

Regards

About Savion pros and cons,

Pros:
"1) You earn good amount. You get paid for the hours worked", true.
"2) You are your own boss. You can work for as much as you want. You can work in more than one place", true.
"3) You can sign contracts and employ employees. This is bit risky, unless you have insurance", and you will have to pay their insurances in case they are not self-employed and you will have some extra-costs to bear toward Finanzamt.

cons:
"1) NO Job security. You can be fired anytime", and the fact that you can have gaps between finding new contracts, thus you have to learn to spare to fill those gaps.
"2) You have to bear the expenses of monthly accounting, taxation, payment of VAT, insurance etc", true and you have to get yourself a good tax advisor because finding a good one suitable for self-employed people is very difficult.
"3) You can be sued incase you make some mistakes. Here better take insurance", if you are in the IT sector, in this case, I advise you to take 2 insurances: a Rechtschutz, in case you get sued, so they will bear the cost and a "IT-Hapftflichtsversicherung", it will be helpfull in case some problems occur with your client and you have to get fine for a reason or another. The one I took costs a little less than 800 euros per year and covers up to something like 2.5 millions.

"BTW, I am freelance since a year and i feel very comfortable in this way", I also do and I really don't think I will go back being employed, unless something definitely happens and I have to.

"u have to evaluate your options", and get good advices regarding this subject because it's really tricky.

D.