The tax authorities determine whether you're self-employed for income tax or not. For that, they look at whether you make a profit and how much time you spend on your business. Often, the decision depends on your specific situation.
To determine whether you are a freelancer, the tax authorities use a number of criteria which includes:
Amount of clients
As an entrepreneur, you work for multiple clients and have fluctuating income.
Independence
Do you decide how you conduct your work or does your client?
Striving for Continuity
Do you continuously take action to ensure that your business remains a success?
Investing in your company
Do you buy your own equipment? Do you invest in marketing in order to promote your company?
Taking risks
Who is at risk if something goes wrong? Who is liable for any eventual damages?
Pursuit of profit
Judging independence
Your circumstances play an important role in determining whether or not you are a freelancer. In some cases for example, it is less important to have 3 clients. It is not just about meeting certain criteria, but more about how these criterions are interrelated. The extent to which you meet the various criteria is what's decisive.
Example : independence
An interim manager receives an assignment to guide a company through a major reorganization as a freelancer. This means that the freelancer has one client for that year, yet they are still seen as a freelancer. In this case the assignment has a clear beginning and end. There is no relationship of authority and the interim manager may perform their work at their own discretion. The freelancer is also liable for any damages resulting from eventual misguided advice.
Example : disguised employment
A freelancer provides their services to one agency for a large number of companies. They send their invoices to the agency for these services. The party that gets these invoices is seen as the client so in this case, the agency is the client. The freelancer therefore only has one client and does not satisfy the criteria for self-employment. They are in fact employed by the agency.
Source: Chamber of Commerce
