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Sole Trader, just PRSI & IT?

  • 18-03-2015 3:14pm
    #1
    Fraz99
    Registered Users, Registered Users 2 Posts: 6 ✭


    Hi,
    I'm currently looking in to setting up a small business as a sole trader. From my research I found out that I'm only elligible to Income Tax (20/40%) and PRSI (4%). My Income would be below 10,000 for the first year as I'd only be designing small business websites. Also does the fact that I'm 16 make me elligible for any additional tax credits? And is this just tax on business profits and will I be taxed more when I take money out of the business?

    Thanks for any help!
    Sean F


Comments

  • #2
    2ndcoming
    Registered Users, Registered Users 2 Posts: 3,588 ✭✭✭2ndcoming


    Well as a sole trader the business profits are your profits, and thus your income. Business expenses come off your gross profit before arriving at your net profit (the figure you'll be charged on).

    If you have no other income you can earn 8250 net as a sole trader and your only liability will be €500 prsi. Anything over that you add income tax at 20% and if you go over 12000 throw USC in the mix as well.


  • #3
    Fraz99
    Registered Users, Registered Users 2 Posts: 6 ✭Fraz99


    2ndcoming wrote: »
    Well as a sole trader the business profits are your profits, and thus your income. Business expenses come off your gross profit before arriving at your net profit (the figure you'll be charged on).

    If you have no other income you can earn 8250 net as a sole trader and your only liability will be €500 prsi. Anything over that you add income tax at 20% and if you go over 12000 throw USC in the mix as well.

    Thanks for your reply. If I earn below 8250 will I still have to pay 500 euro? Also are there any links I can find these figures?


  • #4
    AppleBottle
    Registered Users, Registered Users 2 Posts: 1,421 ✭✭✭AppleBottle


    Once a self-employed person earns over €5,000, you pay a minimum of €500 PRSI. You pay PRSI from the age of 16 years old. After you earn over €12,500, you pay PRSI at 4%. And then as 2ndcoming mentioned, it's after you start earning over €8,250 that you start paying income tax and €12,012 you start paying USC.

    http://www.revenue.ie/en/tax/it/leaflets/it1.html << This is the Revenue link to the different tax credits and tax rates.

    You will also need to file an annual income tax return where you will pay your tax liabilities. For this, you should register with ROS; http://www.ros.ie/PublisherServlet/info/setupnewcust


  • #5
    Fraz99
    Registered Users, Registered Users 2 Posts: 6 ✭Fraz99


    AppleBottle wrote: »
    Once a self-employed person earns over €5,000, you pay a minimum of €500 PRSI. You pay PRSI from the age of 16 years old. After you earn over €12,500, you pay PRSI at 4%. And then as 2ndcoming mentioned, it's after you start earning over €8,250 that you start paying income tax and €12,012 you start paying USC.

    << This is the Revenue link to the different tax credits and tax rates.

    You will also need to file an annual income tax return where you will pay your tax liabilities. For this, you should register with ROS;

    Okay thanks for your help guys! That seems like all I need.


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