Save tax employ the family question?

private

Does the following mean a child (as in anyone under 18) or does it mean where an adult works for their parents? It might have been dreamt up for farmers maybe.
Thanks

http://www.mcdowellaccountants.ie/save-tax-employ-the-family/

1.Employing a child.
Employing a child in a business means thatchild can earn up to €18,300 tax free (although the income levy could apply) if the proprietor of the business registers as an employer for PAYE and PRSI purposes). This figure takes account of only the personal and employee tax credits. There is no completely clear guide on liability for PRSI/health levy purposes and the final decision rests with the Department of Social and Family affairs. In some cases where PRSI is payable, benefits such as unemployment benefits may also be payable to the child.

barneystinson

Bear in mind employing anyone is a cost to the business - it's not intended to be a way for business owners to shift income from their own name to a child's.

Unless you intend on actually employing them to work in the business and be paid accordingly, then you're leaving yourself open to having the arrangement challenged, and potentially incurring interest and penalties.

private

Understood but I'm the child in question and am running the business and my accountant asked would this apply. Prsi applies but i pay myself very little as business was under pressure. As things are improving and I can take more wages I want to limit my income tax.

So is it a child under 18 or an adult working for a parent

Alan Shore

private wrote: »

Understood but I'm the child in question and am running the business and my accountant asked would this apply.

Think you need a new accountant. Does what apply?

You are a full time adult employee of the business in which you have no ownership. You should be paying PAYE with Personal and PAYE Tax Credits, class A PRSI and USC.

This article refers to business owners being aware that they should pay ther children as employees where the children working the the business part time. It also refer to the child qualifying for the PAYE Tax Credit which only applies where the job is full time.

private

My accountants question was probably as to whether I am full-time or not whereas I was confused by the allusion to " child"

The answer is the child is or can be an adult. There I've answered it myself.