Sole trader question

Duncan31

I plan to register for income tax as a sole trader doing small architectural/engineering works (keeping under the VAT registration limits).
Now I understand I can simply invoice my clients without charging VAT and make a return after year end. What Im wondering about is the requirement for a C2. Surely if I was to do any work for a building contractor, they would require a C2 or else stop tax off my fees whereas being registered for tax allows me to invoice private individuals etc who will pay me in full. Can anyone explain the ends and outs of this?

kennyb3

Not sure what exactly you want to know but here is a good start for you:


http://www.revenue.ie/en/tax/rct/rct-how-it-works.html
http://www.revenue.ie/en/tax/rct/subcontractor.html

Duncan31

The point I was trying to make is that when registered for income tax I can do for example a house design for Joe Bloggs, invoice him and receive full payment then pay tax at year end. If I do work for a contractor, it appears from your links that he will have to retain 35%.
Is this correct?
If so, where is the line between these 2 senarios. Do retail businesses need to retain 35% or should they pay me in full?

kennyb3

RCT will only apply where there is a relevant contract - i.e a construction operation.

This will help

http://www.revenue.ie/en/tax/rct/construction-operations.html

There is no RCt for architectural work. But for the engineering work you ve mentioned I dont know what that entails exactly.

Duncan31

Thats great. When I said engineering, I meant structural design works not any direct cnstruction work.

So no architect would need a C2?

kennyb3

It says on Revenue.ie here (http://www.revenue.ie/en/tax/rct/index.html)

'RCT does not apply to professionals such as architects, surveyors etc.'

Sorry for all the links I just feel its important people don't just take someones word blindly especially if you arent going to engage an accountant.

Duncan31

Thanks,


Great info.