can this be done?

drywash

Hi all,

I have been working a 3-day week for the past month, and am pretty sure my employment will be terminated this week as my boss has amounted pretty large debts and cannot afford to pay me. The business I've been working for has been involved in website design and other aspects of IT including PC repair. I worked completely on my own in the business, my boss was actually a painter and had no knowledge or connection to the work apart from name only.

I'm 24, have been through college and still live at home. I do not want to stuck on the dole like so many others are. I also feel that I could continue this business on my own and more than likely make it more successful than it already was. I had a feeling in November that there wouldn't be a future with my current employer as he had been getting later and later with my wages, despite a steady flow of business coming in. It was then I began to find out about his personal debts and how they were effecting me. I registered my own business name at the time and began working on my own website etc, preparing for the future.

My question is now about working on my own. While I do hope to be able to bring a steady flow of work into my own business, I'm wondering what the best way is to set up. Should I just register as self-employed and work as a sole trader? It seems like the simplest idea but it does raise some concerns for me. My main cause is regarding entitlements that I may or may not be able to get. My brother for example is a carpenter and has been self employed for years, now that work has dried up I believe he gets very little in terms of Social Welfare.

This came up in conversation over the weekend and another method was suggested to me. I was told to register a company, and then become an employee of the company. That way I could pay myself my basic wage, pay my PRSI,PAYE,Levy etc, and then if business were slow I claim for days when I don't work. It sounds like a grand idea but is it even legal? I also figured it wouldn't be possible if I registered the company in my name, but they told me to register the company in my parents name. They are both over 66, my father is a retired bus driver and my mother a house wife, and are both drawing pensions so their incomes are not high.

So basically my questions are, 1. is it even possible to do what has been suggested?
2. if it is possible, would registering a company in my parents name effect their pensions?
3. if this is possible and wont affect them, what type of company should I register?

Sorry if this is confusing or long winded, just wanted to get as much info out there as possible. Also please excuse any ignorance I may have shown in anything I have said, and I really do appreciate any info anyone can give me on this matter.

suey71

If you get laid off next week your going to have to sign on.

I'm not sure how this is done but if you go to the dole office with a business plan telling them that you want to set up a business, they will let you keep your benefits while working for yourself. For a year I think.
I could be wrong.

Good luck.

dbran

suey71 wrote: »

If you get laid off next week your going to have to sign on.

I'm not sure how this is done but if you go to the dole office with a business plan telling them that you want to set up a business, they will let you keep your benefits while working for yourself. For a year I think.
I could be wrong.

Good luck.

Suey is talking about the Short term enterprise allowance which is administered through your local employment partnership or social welfare office.

http://www.citizensinformation.ie/categories/social-welfare/social-welfare-payments/social-welfare-payments-and-work/back_to_work_enterprise_allowance

As for your question. I would advise just keeping it simple, register for self employed status. You can incorporate afterwards if thats what you want. Complicating things by registering the company with your parents etc may come back to bite you later on.

Kind Regards


Dbran

AndyJB

Hi Drywash,
You say you’re now on 3 day week, but how long have you been working for this guy?

Who’s working there the other 2 days? It would seem like a bones of a plan if you were to take the business off the painter before he closes it down.

Firstly……

1) How much is the rent?
2) How much would rates cost?
3) Who owns the shop/unit business is in? Him or AN Other?
4) Why do customers come in? Because he owns it or because work you do is v-good?
5) What’s the weekly turnover? How much money do you take in before expenses?
6) How much would it cost to stock spare parts?
7) What wage would you like? How much could business pay you?
8) Are customers regulars or just once offs?
9) Do you service any local businesses? Any service contracts in place?
10) If you were out with FLU for 2 weeks how would business work without you?
11) Factor in the price of a part timer to fill in for hols sick leave etc.

Other option:

Armed with items 1 thru 11..
Keep list of all clients
When you hear he’s closing.
1) Contact clients yourself and offer them your service directly
2) Work from your parent’s garage, spare room or garden shed.
3) You should be able to offer better prices.

Keep it simple in the short term and if you do take the leap, work as a sole trader and just register for VAT. If things pick up later you can always revisit setting up a ltd company.

Can’t offer any advice on the dole element of what you might do. But, if you’re not already on the social welfare books I believe assistance from them won’t be a runner. Talk to them anyway. Also would be worth speaking with your local FAS office they might offer a “starting your own business” course at the very least. Should cover ideas for VAT returns etc.

Just some food for thought

Best of luck.

Axwell

dbran wrote: »

Suey is talking about the Short term enterprise allowance which is administered through your local employment partnership or social welfare office.

http://www.citizensinformation.ie/categories/social-welfare/social-welfare-payments/social-welfare-payments-and-work/back_to_work_enterprise_allowance

I think with that scheme you need to be on social welfare for a year already before you can apply but I could be wrong. I would imagine your brother gets the standard amount of social welfare, its not a huge amount in general, around €200. There are just more hoops to jump through if you are self employed because you wouldnt have payslips and a p45 etc from your employed to say you got let go from a job.

If you think you can run the business yourself then you should look at becoming a sole trader and go for it, you obviously feel you can do a better job and if you have the drive to do it and things are already in place because you are working for the guy then it has to be worth a shot.

dbran

Axwell wrote: »

I think with that scheme you need to be on social welfare for a year already

Hi Axwell

No this is a scheme that came in April 2009 and not the "back to work scheme". See down towards the end of the link. You can go on it immediatley.

You just have to be entitled to jobseakers benefit ie paying the "A" stamp PRSI. Then you just need to sign on for a week as you must be unemployed to go on the scheme.

Kind Regards


dbran