One of the simplest forms of ordering a specific work is a contract for a specific work. The conclusion of the contract for specific work means that the ordering party obliges itself to perform a specific work and the ordering party obliges itself to pay the remuneration. At the same time, what matters in this case is not the amount of work done by the contractor but what has been created as a result.
What kind of work can such a contract concern
There are quite a lot of possibilities here, the subject of the contract for specific work can be writing a journalistic article, a script, a program, creating a website for a given company, writing a book, making a sculpture, a piece of furniture, a photograph or painting.
In return, the ordering party declares in the contract a remuneration for performing the work. It can have a form of a lump sum or cost remuneration.
The contract for specific work is beneficial for the ordering party because it does not have to pay any social insurance premiums – the contractor is not subject to social or health insurance. A contract for specific work may be concluded with one’s own employer but then it is covered by the social insurance obligation.
The exception is the situation when the employer concludes a contract for specific work with his own employee who is on maternity, parental or unpaid leave. The contract for specific work is taxed. If the gross amount does not exceed PLN 200, the so-called lump-sum tax is applied.
In that case, a tax of 18 percent is deducted without taking into account tax-deductible costs. In all contracts for a specific work of art concluded for an amount exceeding PLN 200 gross, the advance tax rate is 18 per cent or, if the annual income exceeds PLN 85,528, 32 per cent. In a traditional contract for a specific work of art, revenue-deductible costs of 20 per cent are applied, whereas in the case of a contract for a specific work of art with copyrights, revenue-deductible costs are 50 per cent.
When can a contract for specific work be concluded?
In order to conclude a contract, the parties have to specify who concludes it and what is to be created as a result, how the principal is to collect and use the work, the manner of settlement and termination of the contract. The period of performance of the work can be set for any period. The contract for a work of art for an indefinite period of time cannot be concluded because it would mean that although there is a subject of the contract, the performer of the work can perform it indefinitely. On the other hand, it is not required to specify the date of release of the work in the contract.
Depending on the needs of the parties and the subject matter of the contract, each contract may sound slightly different. However, always Both parties must be identified in the contract in a way that does not raise doubts about their legal identity. In the case of a company, the full name, Tax Identification Number (NIP), address, National Court Register (KRS) (if a company), and in the case of a natural person, the name, pesel and address of residence are given.
The contract for specific work – termination
The contract for specific work cannot be terminated by any of the parties, however, in certain cases, the parties can resign from the work. It can happen e.g. in a situation when the ordering party does not deliver necessary materials or does not answer questions concerning the task. The reason may also be too low remuneration in relation to the workload.
The client has the right to withdraw from the contract at any time – e.g. if the work has defects that cannot be removed, if the contractor is so late with commencing or completing the work that it is very likely that the contractor will not complete the work within the contractual deadline, if the contractor creates the work in a defective manner or in a manner contrary to the contract and does not respond to the client’s request to change the manner of completion or repair the defects caused, or if the work has not been completed. The only condition is the payment of remuneration – less the amount saved due to the lack of necessity to complete the work.
According to the regulations, the person performing the work is fully responsible for the result of the work, i.e. possible defects in the completed work, the removal of which may be demanded by the ordering party. Contract for specific work has a big advantage. It is the freedom of the way of performing the work. Contractor can perform a work in any place and time and, what is important, he does not have to perform it personally. However, it all depends on the provisions included in the contract which may impose some limitations or methods of its execution.
Usually, the contract is prepared by the person ordering the work and sent to the contractor. The completed and signed contract should be archived. After completing the work, the contractor should issue a bill with an account number and the gross amount and send it to the ordering party. On this basis, the principal pays the remuneration. The advance tax payment is made by the Principal.