How a commercial contract works

In recent years, more and more companies are launching job offers but offering a commercial contract , that is, a contract in which the person hired will not be a direct part of the company but will be hired as a freelancer. It is important that, before signing such a contract, you know what it is and how it will affect your relationship with the Treasury and with Social Security. In this article of a How we are going to tell you how a commercial contract works to clear all the doubts that may arise in this regard.

Steps to follow:

1.The crisis has caused many companies to see their economic situation in a precarious state. This has meant that in order to cover business needs, they had to hire professionals but not through an employment contract but instead they have used the commercial contract, a type of agreement between two companies, two freelancers or a company and a freelancer in which It is reflected the labor relationship that will exist between the two indicating points such as salary, working hours, duties and rights of each of the parties, and so on.

Thus, the first thing you have to know is that in a commercial contract you will NOT be part of the company”s workforce, that is, they will not pay your Social Security or hire you in the eyes of the Treasury but it will be you who will have to register as a freelancer to work within the legal framework.

2.So, when we talk about this type of contract, we mean that a company contracts externally the services of a professional or another company without any other obligation arising between them. Usually, this type of work is usually offered to commercials who are autonomous, to professionals who are experts in some field, and so on.

So depending on the type of work you are being offered, you may not be interested in this type of contract because you will not be covered by Social Security and you will have to carry all the expenses that the freelancers have (the payment of the autonomous fee, VAT, personal income tax, etc.).

3.Therefore, to know how a commercial contract works, the first thing you should keep in mind is that, before signing it, you will have to go to the Treasury to register as a freelancer ; If you do not, you will be signing an illegal document and, even worse, you will be working in black and the Treasury can fine you. So don”t play it!

These contracts are usually signed between two parties that are on the same level: one is looking for a service and the other offers it legally (as a freelancer). If the two agree, then the contract is drafted, which must be signed by both parties and must include basic aspects of the agreement such as, for example, salary, working hours, right (or not) paid vacation days and other aspects that are negotiated.

4.Therefore, it is important that you know that if you sign a contract of this nature, you will not have the same rights as a worker. To understand it better, we will now discover the main differences between an employment contract and a commercial contract:

  • The worker pays his employees through a payroll in which Social Security contributions are discounted; in the case of the merchant, it will be he who will have to issue an invoice to the company that has hired him discounting the IR PF and including VAT.
  • The employment contract includes a series of worker rights, such as paid vacations, medical leave, leave of absence, and so on; In the case of the merchant, these rights are not included unless an agreement is reached with the contracting company.
  • Another important difference is about the unemployment benefit since the labor worker does have the right to this compensation in case he is left without work but, nevertheless, the mercantile one (like the self-employed) does not have the right to this benefit.

But, in addition to all these factors that might seem inconvenient, the truth is that being autonomous has some great advantages such as being your own boss, being able to organize your own work, not having to sign up in a company, and so on. In this article we discover the advantages of being autonomous.

5.In addition to this, you should know that there are different types of commercial contracts that fit each situation and that contain specific characteristics. Here are the most used:

  • Exchange: this type of contract is usually signed in the case of an exchange of one good for another as, for example, in the case of a sale of a vehicle, the work contract, and so on.
  • Collaborative: is when an entity hires someone to perform a specific task and in a timely manner, for example, it may be the case of a writer with his editor, an agency with his representative, and so on.
  • Of loan and credit: especially it is managed by banking entities and usually they are signed when an economic benefit is made to an individual or company and that the commercial relation is based on the payment of interests.

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