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2026-04-15

What is the difference between an employment contract and a self-employed activity?

Darbo sutarties ir individualios veiklos skirtumai

Employment relationships can be organised either through an employment contract or as an individual activity. Each option has its advantages and disadvantages.

Employment contract – stability and guarantees

An employment contract gives the worker:

  • a fixed salary
  • paid leave
  • sickness benefits
  • set working hours

The employer takes care of part of the tax and social contributions. This form is suitable for those who value stability and social security.

Self-employment – freedom and risk

Self-employment

With self-employed accounting, you organise your own work, pay your taxes to Sodra and buy equipment. This gives you more freedom in terms of working hours and earnings, but there is no guarantee of a steady salary, holidays or sick pay. Self-employment is often chosen for freelancers, small service companies and consultants.

Conclusion:
Contract work is more suited to workers who value stability, while self-employment is more suited to professionals seeking autonomy and flexibility.

Accounting services in Kaunas and throughout Lithuania, as well as other related questions or answers by phone – +37061228888. Our team is ready to help.

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