We have employees and independant contractors that work full time.
We use “payslips” tab to track employee wages etc.
Would it not be better to have contractor labor and invoices separated from “purchase invoices”?
Not really. You probably are paying the supplier who invoices you for the labor you have used.
The best way to record you finances is to have your records correspond to reality as much as possible and therefore, recording outsourced labor as a Purchase Invoice is the better practice.
Treating your contractors as suppliers and recording their invoices as purchase invoices also reinforces (for the benefit of your tax authority) that they are not, in fact, employees. Having another functional tab in Manager to separate contractor transactions from other suppliers would blur the line between those contractors and employees. It would also be completely redundant from an accounting perspective. Most tax authorities look very unfavorably on perceived attempts to avoid various payroll taxes and levies by treating de facto employees as contractors.
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