How to tax this job when not registered?

curadh

I'm confused. Like everyone I'm strapped for cash. Not much work, if any. Have been offered a job in a weeks time but not sure if I can take the work if I'm not registered to charge tax...and its not the type of work you would consider doing cash..not that I would ever do that. So just wondering if I was to take the job how could I pay tax on it? Basically what do I need to do to get this work!

Legend100

What is the business, sorry if that sounds personal, it would just help with giving you an answer.

If you are doing work on a non-paye basis, you would register for tax now as a sole trader and prepare an annual set of accounts. your tax would be payable once a year in October depending on the profits of the trade. So if you started now, you first taxable period would be from your starting date to Dec 31st of 2009. You would prepare a set of accounts for 12 months and the profit would be apportioned depending on specific commencement situation rules.

You need to talk to an accountant to get professional advice

curadh

Thanks for the reply Legend100, the business is letting and managing property, so could never be done cash. I had a business but its no longer going. Doing a set of accounts again just for this job would cost more in paperwork from the accountant than its worth I'm guessing.

curadh

Just wanted to add, I went to my accountant and he has said I can earn up to about 35k before having to pay tax. Surely this can't be right? I ceased trading at Christmas and have had little or no work, barely scraping by. Why is it that I am not eligible for social welfare yet past employees of mine half my age are, and are living comfortably.
Can I ask this. If I take this one job worth about a grand, and not charge VAT, and give receipts, and the customer uses the recipts towards their expenses when doing their returns, do I get audited...?or what happens. Basically returns audits etc etc cost money and I am broke. I dont want to go to jail ultimately for trying to work.

swanvill

Hi,
Your ex-employees can get social welfare due to the fact they had class A stamps paid, as self employed /director would have paid class S which means you must pass a means test before you get social welfare. You can claim jobseekers allowance but you must pass a means test. Your PRSI contributions were at a lower rate than your employees thus that is why you are entitled to different set of benefits.

Regarding VAT if a new business and a service then you do not have to register for VAT until you estimate that you might break the €37.5k billable threshold. If you were previously registered for VAT as a sole trader and billed under the old business name you would have to charge VAT. Is it possible to charge VAT on the job? If the €1k include vat it would be €823 with €177 for vat.

Regarding income tax unless you are over 65 there is no income threshold where you do not have to pay tax. Once you work out your profit, you will be taxed on that plus you will have your tax credits to reduce your tax bill. Based on the little information that is in the post you may not have any tax liability but you would need to get an accountant to review your situation.

My advice is to take the job, get the money and worry about the tax later. You should be able to write off some expenses against the job and reclaim some input Vat. If not happy with your accountant go talk to another and get a quote for taking care of this job.

Regards,

Sean

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