Advertisement
If you have a new account but are having problems posting or verifying your account, please email us on hello@boards.ie for help. Thanks :)
Hello all! Please ensure that you are posting a new thread or question in the appropriate forum. The Feedback forum is overwhelmed with questions that are having to be moved elsewhere. If you need help to verify your account contact hello@boards.ie

Sole Trader vs Payroll?

Options
  • 29-05-2011 8:21pm
    #1
    Hannibal6.0
    Registered Users Posts: 134 ✭✭


    I have recently set up a company but have yet to begin trading as there is still a lot of preparation involved before I can do so. As I am just finished college I am about to enter full time work in order to get needed funds. I have been giving the option for my new employment to ether go on payroll or I can work as a sole trader and look after my own affairs.
    My Question is: Since I have a registered company in which I am the director, what would be the best option for myself to take with this new employment should I just go on pay role or do should I go an register as a sole trader and look after my own tax???
    Tagged:


Comments

  • Options
    #2
    mari2222
    Registered Users Posts: 568 ✭✭✭mari2222


    The advantage of being on payroll is that it is convenient. Do you have the skills to manage your own accounts and tax affairs? If so, the value of the convenience may be small. Should your job end, you will be able to claim social welfare (aka dole) if you were on payroll - not if you are in business on your own account (other than some means-tested benefits).

    You will be entitled to paid holidays as an employee, so your fee as self-employed will need to be higher than a "wage".

    If you decide to use the company, you will be able to claim as deductible any expenses wholly and necessarily incurred in delivering your service.

    You may not have an option but to be an employee - see the revenue.ie website which looks at several factors that determine how Revenue will see your position.


  • Options
    #3
    srsly78
    Registered Users Posts: 7,157 ✭✭✭srsly78


    You are not a sole trader anymore, you are a Director. Draw a modest salary and pay PAYE on it is the usual way. At end of year you can see how much profit there is and pay yourself a bonus (note this would be self-assessed). So, most people go with a combination of PAYE and self-assessment.

    Regarding your REAL question, go as self-employed because contractors usually earn more. Note this is only worth it if on decent money (e300+ per day), otherwise you are just getting payroll hassle for little gain. If you earn decent money it is worth managing your own affairs however.


Advertisement