Help needed for contracting in Ireland.

powerstar

Hi, I am Non-Eu national, presently working in the IT sector. Now I got a 9 months contract job offer from a good company. So, if I take up that job how would I sort out all my tax ? Before my employer was deducting all PAYE & PRSI
from wages. What is the procedure for contract jobs in Ireland. Do I fall under self employed or sole trader? Do I need to form a limited company and invoice them through that company? Please advise me. If u know any accounting firms good at dealing with contract jobs pls let me know.

Many thanks

Clanket

powerstar wrote: »

Hi, I am Non-Eu national, presently working in the IT sector. Now I got a 9 months contract job offer from a good company. So, if I take up that job how would I sort out all my tax ? Before my employer was deducting all PAYE & PRSI
from wages. What is the procedure for contract jobs in Ireland. Do I fall under self employed or sole trader? Do I need to form a limited company and invoice them through that company? Please advise me. If u know any accounting firms good at dealing with contract jobs pls let me know.

Many thanks

Have you worked previously in Ireland. You say before, my employer was deducting all PAYE & PRSI which indicates you have worked here at some stage so you should have a PPS number.

It really depends on the contract. If the contract is an employment contract then your employer will be responsible for deducting taxes. However, if the contract is not an employment contract then you will have to go down the sole trader/company route.

There are a lot of different things to be considered in the employee v self employed situation. Type "Code of Practice for Determining Employment or Self-Employment Status of Individuals" into the search on www.Revenue.ie and the second one down is very helpful.

powerstar

Hi, Thanks for the reply. I worked before in Ireland. But now I am moving from full time employment to contract roles. Here I am not sure about how to sort ut my thanks. I am confused between sole trader and self employed.

Any help would be appreciated

Clanket

powerstar wrote: »

Hi, Thanks for the reply. I worked before in Ireland. But now I am moving from full time employment to contract roles. Here I am not sure about how to sort ut my thanks. I am confused between sole trader and self employed.

Any help would be appreciated

Sole trader and self employed are the same thing. A person working for themselves is self employed and there are a few different headings they can operate under - sole trader, partnership etc.

There's no difference between full time employment and contract employment providing the employer recognises the fact you are an employee. If this is the case then your employer will be responsible for operating the PAYE system on your salary.

If they say to you that you are not an employee and that they want you to be self emplyed and invoice them rather than receiving a salary then you need to start thinking about sole trader (or alternatively a one shareholder company belonging to you).

So what you need to clarify is if the company accepts you are a contract employee or whether they say you are a self employed contractor.

Al.

powerstar

Many thanks for the info.

PhoenixTax

As the other posters correctly point out, the first thing to do is to get the company to clarify whether you are to be an employee or to look after your own taxes.

If looking after your own taxes, you then need to decide whether to do it as a self employed individual or whether to set up a company. There are a number of advantages/disadvantages of both. There is more admin involved in going the Ltd company route, however many contractors choose this option as it gives greater flexibility for extracting funds in a tax efficient manner e.g. payment of mileage and subsistence.

I provide tax/accounting services to a number of contractors so feel free to PM me if you have any further queries.