Insurance Costs

[oraclesmith]

Perhaps, but if they do, that's what PLI is for - damage to third parties and their posessions.

They may claim they are effectively an employee, even though may be no actual employment contract in place. I don't know whether this would stand up to scrutiny, but I guess there's no harm in having employer liability as part of a package. Also, how about the case of a company secretary (partner/wife) who you maybe pay a nominal annual fee to for their time. They could also claim they are a defacto employee I guess.