The "screw entrepreneurism" PRSI system

malene

Ok, so we now know from listening to Liveline etc, that you get NOTHING from the state when you become self employed, even though you pay PRSI, hense, why so many people would probably love to set up a business but the dole system tells them, do nothing, u benefit that way, and yet the dept of social welfare says too many people on the dole.

So, my question. What is the deal when you set up a company, (but earn nothing, because of the nature of the business means money may not be coming in for quite some time), but you also work for someone else?

Your employer will pay prsi on your wage , but you'll pay no prsi, unless it's voluntary, because you're taking no wage from the bussines for now)

can you still be on JSA (means tested) from the prsi payments on your other job?

Thanks.

Xiney

If you are also an employee and paying PRSI class A, you are eligible for JSB (with enough payments)

If you do not have enough class A payments (either through not having worked enough or having been self employed and paid class S) you can apply for the means tested JSA.

Also, if you are on JSB, or if you have been on JSA for 12 months or more, you can apply for Back To Work Enterprise Allowance (BTWEA) which allows you to become self employed but retaining your social welfare payments for a period of time while your business becomes established.

PaddyThai

It is my understanding that if a self employed person applies for social welfare they need to prove that they are no longer earning. If you think about it that makes sense. A carpenter does not go from amking a living to making nothing. They will probably still get a few jobs. The problem is that to get any dole you have to show audited accounts for about two yeras. This can cost a couple of thousand from an accountatnt. Typically a self employed person is already in dire straits by the time they go to social welfare and cannot afford the accountant.

malene

The problem is that if i go alone, because of the nature of this business, it could be a year, two or even three before I earn anything. So, to cover myself i would still work part time, even though I'd be a director of a company that was earning nothing and pay stamps through my other job.

Mal

RCIRL

PaddyThai wrote: »

It is my understanding that if a self employed person applies for social welfare they need to prove that they are no longer earning. If you think about it that makes sense. A carpenter does not go from amking a living to making nothing. They will probably still get a few jobs. The problem is that to get any dole you have to show audited accounts for about two yeras. This can cost a couple of thousand from an accountatnt. Typically a self employed person is already in dire straits by the time they go to social welfare and cannot afford the accountant.

I know someone in this situation, self employed all his life and can no longer work due to the complete wipe out of the construction trade. This person has applied for some welfare assistance but cant afford to close the business and finalize the accounts so not a single penny comes into hand. After all the years employing people, and living here paying VAT on everything the person is now in complete poverty. To make matters worse 750 euro is owed to the revenue if its not paid their is a possibility of the person going to jail. Good on you FF over the last 12 years you've set up a great system for the citizens of Ireland.

malene

Why would ANYONE set up a business here??

TheBeach

malene wrote: »

The problem is that if i go alone, because of the nature of this business, it could be a year, two or even three before I earn anything. So, to cover myself i would still work part time, even though I'd be a director of a company that was earning nothing and pay stamps through my other job.

Mal

With your part time work you would be paying class A contributions, which would entitle you (should you need it) to apply for unemployment Benefit, so you wouldn't be penalised in any way.

malene

TheBeach wrote: »

With your part time work you would be paying class A contributions, which would entitle you (should you need it) to apply for unemployment Benefit, so you wouldn't be penalised in any way.

Ok thanks.

mal

RCIRL

malene wrote: »

Why would ANYONE set up a business here??

This is the current view of many people in Ireland, whats the point?
Also the international business have the same view, those already set up are stating to move away.

All the dealings with the EU haven't worked out the best, we depend upon other countries for our success, if things go bad else where Ireland comes to a stand still, its happening now.

Common sense is to look after your own first and maintain that, while maintaining the interests of your own you can then look else where for other opportunity's. If those opportunity's fail all is not lost because you have a system set up to survive on your own.

Our Government lacked the above common sense over 12 years and now we are suffering.

The only solution is to emigrate.

CamperMan

you know, for the past 6 months or so, I have been living off my income (self employed) of about 200 euros a week, I have to pay 100 euro per week rent... the dole will not help, it's a feckin disgrace, my blood is boiling

godtabh

malene wrote: »

Why would ANYONE set up a business here??

To make money. Some people a prepared to work at at this

PaddyThai

RCIRL wrote: »

I know someone in this situation, self employed all his life and can no longer work due to the complete wipe out of the construction trade. This person has applied for some welfare assistance but cant afford to close the business and finalize the accounts so not a single penny comes into hand. After all the years employing people, and living here paying VAT on everything the person is now in complete poverty. To make matters worse 750 euro is owed to the revenue if its not paid their is a possibility of the person going to jail. Good on you FF over the last 12 years you've set up a great system for the citizens of Ireland.

I would be interested to know how someone who was in the building industry throughout the building boom did not manage to save a bundle or invest in property etc. for the future.
Also, if you owe revenue only 700 euro they should be more than happy to accept apymant in installments.

I do agree with yopu that someone who tooka a risk and set up a business thereby paying VAT, Income tax, PAYE, PRSI and other taxes should not be worse off than people who made a lifestyle choice to live on socail welfare and make sure they get all the benefits.

I can't see the system surviving in it's present form.

malene

But the PRSI system discriminates against self employed going on dole after going bust, but somehoe, if you're an immigrant, you can get children's allowance for your 4 kinds in Romania etc...

yep, the system is screwed. :mad:

Xiney

malene wrote: »

But the PRSI system discriminates against self employed going on dole after going bust, but somehoe, if you're an immigrant, you can get children's allowance for your 4 kinds in Romania etc...

yep, the system is screwed. :mad:

Not legally, you can't.

The system isn't screwed. If you have information about specific people commiting social welfare fraud, report it. Otherwise, conjecture is of no help to anyone.

Please read the state benefits forum charter as you're getting pretty close to an infraction at the very least with this post.

Sonic_exyouth

malene wrote: »

Ok, so we now know from listening to Liveline etc, that you get NOTHING from the state when you become self employed, even though you pay PRSI, hense, why so many people would probably love to set up a business but the dole system tells them, do nothing, u benefit that way, and yet the dept of social welfare says too many people on the dole.

So, my question. What is the deal when you set up a company, (but earn nothing, because of the nature of the business means money may not be coming in for quite some time), but you also work for someone else?

Your employer will pay prsi on your wage , but you'll pay no prsi, unless it's voluntary, because you're taking no wage from the bussines for now)

can you still be on JSA (means tested) from the prsi payments on your other job?

Thanks.

Can you still be on JSA?
No, if you are not Genuinely Seeking Work (GSW) you are not entitled to the JSA, or JSB.

Further,
If you pay PRSI at the full rate, you get the full JSB.
If you may the minimum (which most self employed people do) the state will still pay their hospital bills, but, their own income insurance has to be sorted by temselves.
They can volunteer to pay the full PRSI stamps, they are not obliged to pay S class.

Further, there are 3 benefits given to setting up as self employed, when unemployed.
1. If unemployed for less than a year, A grant is given from Fás if the person completes the business plan course and submits a decent business plan.
2. If unemployed for between one and Two years, your tax credits with the Revenue are doubled
3. If Unemployed for two years or more, DSFA will pay your dole for the first year, 75% for the second, 50% for the third and finally 25% for the 4th.