Best Restaurant was opened five years ago by Mr and Mrs Minach. Their business h

Question

Best Restaurant was opened five years ago by Mr and Mrs Minach. Their business has
flourished the last three years and they sought assistance from relatives and friends with their
business. Previously, they had hired relatives a couple of times. However, the last two years
has seen an increase in customers and they hired Sam (a student) and Margaret to help with
their business. They were hired from Tuesdays to Sundays as the restaurant closes on
Mondays. Each of them were given one week’s training in restaurant operation. Sam worked
from Tuesdays to Saturdays for four hours per day. His duties included getting supplies and
paying suppliers invoices on Tuesdays and Fridays. The other duties are serving customers
and helping in the kitchen. Margaret worked from Wednesdays to Sundays for eight hours
per day. Her duties included taking orders, receiving cash, banking cash and reconciling cash
on a daily basis. The other duties included taking orders and food preparation. Both of them
were given free meals during working hours. To minimise the administrative work, Best
Restaurant paid Sam and Margaret by cheque their gross weekly wages at the end of the
week.

Inland Revenue believes that Sam and Margaret are employees of Best Restaurant and therefore Best Restaurant must deduct PAYE from their weekly payment. Do you agree? Discuss your answer.

Explanation / Answer

Answer:

Since, Sam and Margaret are working with the Best Restaurant for fixed working hours and fixed days in the week and are paid their compensation for work on weekly basis. Therefore, they fall well within the definition of Employee of Best Restaurant. So, depending upon their pay scale from BEst Restaurant, PAYE must be deducted from their weekly payments.

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