Short term enterprise allowance and PAYE credit

phormium · 31-07-2012 12:43pm #1

The short term enterprise allowance is taxable and on the citizens info website regarding taxable social welfare benefits, it says you are entitled to a PAYE allowance if you are receiving a taxable benefit.

Does this mean that for example if a person who had started a business and was receiving the STEA for part of the year until it ran out, when they are doing their returns and inputting income from business and income from STEA can they claim both the personal allowance and the PAYE allowance for that year?

(BTW rang Revenue but person I spoke to says STEA is not taxable in first place, I don't think they are right though)

smeharg · 31-07-2012 12:57pm

You need to determine exactly what you are getting.

Short-term enterprise allowance is Job Seekers Benefit - which is taxable and in respect of which you are entitled to PAYE credit.

Back to work enterprise allowance is Job Seekers Assistance - which is not taxable and in respect of which no PAYE credit is due.

The first goes in your tax return; the latter doesn't.

phormium · 31-07-2012 1:10pm

Yes it is the Short Term Enterprise Allowance, the one that runs for the same length of time as your jobseekers benefit, so I have it right. It goes on the return and person claims PAYE allowance even though self employed, correct?

smeharg · 31-07-2012 1:22pm

Yes. The PAYE credit is only available for credit against PAYE income, though.

phormium · 31-07-2012 1:29pm

Sure that isn't helping them at all so, as obviously the person on the short term enterprise allowance has started a business so is not a PAYE earner.

barneystinson · 31-07-2012 1:54pm

phormium wrote: »

Sure that isn't helping them at all so, as obviously the person on the short term enterprise allowance has started a business so is not a PAYE earner.

STEA is treated as PAYE income.

I think what Smeharg meant was that (say) your STEA income is €5,000, and your self employed income is €20,000; then you will only be entitled to €1,000 of PAYE tax credit. i.e. €5,000 @ 20%.

phormium · 31-07-2012 1:54pm

Just rang another tax office now and was told can claim the PAYE allowance even if no PAYE income once in receipt of a taxable social welfare payment, ah hell at this stage I'm putting it in for them anyway.

Just saw that reply now, yep that's fine, understand that, the STEA income is a little less than that and the credit that shows is around the 800+ mark. Understand that it can't be used against the balance of the self employed income, which unfortunately is no where near 20k

Short term enterprise allowance and PAYE credit

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