GLOBAL PAYROLL MAGAZINE
27
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In Ghana, additional factors are considered; including economic dependence, time investment, and the opportunity for profit or loss. The Ghanaian Internal Revenue Service also adheres to specific guidelines for classifying workers. Taxation As in most regions, taxation in Africa is strictly regulated. Independent contractors are responsible for filing and paying their own taxes, a responsibility that shifts to the employer when a contractor becomes a full-time employee. This transition requires the employer to handle tax
deductions and contributions, which is manageable with an efficient payroll system. However, a potential consequence is that the newly employed worker may earn less after taxes, leading to possible requests for higher compensation—an expense that must be considered alongside statutory benefits. Operational risks 1. Lack of control & commitment Independent contractors have the freedom to choose how, where, and when they work, which can lead to challenges if their pace or methods differ from your company’s needs.
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