Employee vs. Virtual Assistant: You Make the Call

According to the U.S. Small Business Administration (SBA), the average small business owner spends up to 40% of their time on routine administrative tasks. If you do not want to wind up as a statistic you have two choices—hire an employee or a virtual assistant. Both choices share the same goal in reducing your involvement in day to day operations; however, the ball is in your court in the way you choose to go about handling this situation.

Employee: An employee is someone who performs services for you and you control what will be done and how it will be done. You are responsible for training this person and they must be paid for the agreed upon hours (even if you do not have work for them to perform). An employee is someone who is solely dedicated to your needs and can be called in whenever you need them. As a business owner you must withhold income tax and your portion of social security and Medicare taxes. You must give your employees a W-2 Form, Wage and Tax Statement, showing the amount of taxes withheld from their pay.

Virtual Assistant: Think of a virtual assistant as a consultant. When you hire a virtual assistant you own the rights to control or direct the result of the work, but do not have a say in what means or methods are used in accomplishing the task. Virtual assistants typically have their own business (i.e. they determine their own price, hours, etc.). You are only required to pay them for hours that they work (typically on an hourly or project basis). You do not need to train a virtual assistant because they are already qualified for the position ( they typically perform work under a specific niche-i.e. marketing) and again when hiring a virtual assistant you have no say in what methods they use in accomplishing the task you hired them to complete.

In order to keep yourself from being in trouble with the IRS, keep in mind that an employee is someone who performs services for you and you can control what will be done and how it will be completed. When you hire a consultant you own the rights to control or direct the result of the work, but do not have a say in what means or methods are used in accomplishing the task. If you fail to understand the difference between an employee and a consultant you will be subject to paying not only back taxes and penalties, in addition to all the other expenses that the person would have had as a fulltime employee, including overtime and benefits.

Although I am bias towards hiring a virtual assistant, I seriously do hope that you are able to hire someone—regardless of whether it be you hiring an employee or virtual assistant to handle your administrative tasks so you can devote more time to your craft—after all isn’t this why you went into business?