Annual Returns - self employed??

collegemum

I have received a job offer to work in a company 5 mornings a week (20hrs). The MD has said that he would like me to invoice him for my services on a monthly basis.
I will not be earning enough to register for VAT but does this mean i'm effectively becoming self employed???
What does this mean for me and what do i have to do??
Thanks in advance
J:)

wishful thinker

you actually may not be considered self employed. Most recent from the Rev Comm, they are looking at situations where people are contracted to work for companies but the companies determine:

• the place of work;
• the hours of work;
• the duties of the role;
• provide the tools (computer & software) to do the duties.

There are other conditions to add to this.

From the short amount of detail you provided, it would actually seem that you should be treated as an EE, even though the MD might think different.

and why would he???

-firstly he would not have to pay ER PRSI @ 10.75%
-he wouldn't have to operate PAYE/EE PRSI

and why does this matter to you and him?

well if you did as he currently suggests and then the Rev Comm looked at this (and they are) then it would cost the company (for not paying ER PRSI) and potentially you (as not paying EE PRSI means you are not entitled to redundancy, and would affect old age pension).


conclusion - probably best advised to be an EE - for both you and the MD's sake

phunkymonk

Hi,
Im in the same situation as the OP. i have been working for a company for 3 months now invoicing them for my work. I am being deducted 20% tax on my gross pay but i am soon to finish up. My worries are that im not set up for PRSI...if i want to make these PRSI payments..

what rate is it at?
am i self employed?
do i have to pay a health levy?

When i finish up here I will have to go on the dole but worried they may ask why I havent signed for the dole when i finished my other job a few months ago because they wont see any prsi payments since i started this invoicing craic?

am i considered self employed?

Thanks in advance.

Mr Clonfadda

Hi phunkymonk

You have been self employed imo but why were company deducting 20% Tax ?

Do you have anything in writing that your employer has paid this money to the Revenue?

Self employed PRSI Rates are 3% up to 500 euro
or 7% if you earned over 500 euro but this is generally paid on your profits not what you've invoiced for.

Health levy is the extra 4% above if you earned over 500 euro a week

However as wishful thinker points out your employer may be in danger of being caught for employers PRSI

Regards

DoMyBooks

Its also worth pointing out at this point that it will be the employer who is liable for the PAYE/ PRSI never deducted not you. They are obliged to deduct and collect PAYE/PRSI not you.

phunkymonk

thanks for the replies,
I have been working in a govt dept for a few weeks so thats why i am bein deducted tax on my earnings.

I am not set up for PRSI but im looking into it at the min. As this is only short term, when i finish up am I (1) entitled to taxback i have paid so far this year - if so how much? (2) am i entitled to claim unemployment benefit as its doubtful i will go straight to another job?

I dont consider myself self employed but it seems as tho it might be operating that way, eg when i finish up i plan on looking for a job but not going out 'on my own' providing a service...

has anyone been in a similiar situation? or any advice?Thanks.

Mr Clonfadda

Wether you are due tax back will depend on how much you earn for the year.
You will have to file a tax return and prepare an income and expeniture statement for your self employed work and any excess income will be taxable.
You won't qualify for unemployment assistance based on your self employed work but will propably qualify with your previous contributions.
Best advice - Talk to expert