Quick question about business and taxes etc.

Seanf999

If someone starts a business where they don't make a lot of money, (ie like when you are employed and if you make under a certain amount then you are exempt from a certain charge)
If you own a business that makes say €8000 a year, do you still pay the same taxes and charges etc that someone who is making enough to comfortably support themselves?

Also do the certain exemptions still apply to you?

Apologies for sounding like someone with a concussion.
I'm turning 18 soon and I would like to start a small company more so for experience then profit. Hence why I'm asking.

jimmii

At €8000 you will be paying PRSI and income tax on that. The thresholds are practically non-existent. The only thing that has a somewhat high threshold is VAT which is 75k for goods and 37.5k (or thereabouts) for services but that can dependent on exactly what you are doing too. A "hobby" business is a good way to learn about the world you will probably pick up more about running a real business doing that then you would studying it in school. Its also a lot more fun than working in some random part time job!

Citizens Information has some good information and if you go to your local enterprise office they will probably run some courses that you will find interesting.

Do you have anything in mind you are thinking about doing?

Seanf999

jimmii wrote: »

At €8000 you will be paying PRSI and income tax on that. The thresholds are practically non-existent. The only thing that has a somewhat high threshold is VAT which is 75k for goods and 37.5k (or thereabouts) for services but that can dependent on exactly what you are doing too. A "hobby" business is a good way to learn about the world you will probably pick up more about running a real business doing that then you would studying it in school. Its also a lot more fun than working in some random part time job!

Citizens Information has some good information and if you go to your local enterprise office they will probably run some courses that you will find interesting.

Do you have anything in mind you are thinking about doing?

Thank you for clarifying!
I do actually I have numerous ideas, I just end up writing them down and storing them away, when the time is right I'll chose my best option and work from there..
All the ideas I've run through and made sure I got rid of anything idiotic. The two thing stopping me now are timing and resources.

hfallada

OP if you earn 8k a year. You will pay zero Income tax(16,800 threshold) and USC(12,000 threshold). But you will have to pay a €500 PRSI contribution. If you earn under €5k you wont pay a cent in tax.

jimmii

Seanf999 wrote: »

Thank you for clarifying!
I do actually I have numerous ideas, I just end up writing them down and storing them away, when the time is right I'll chose my best option and work from there..
All the ideas I've run through and made sure I got rid of anything idiotic. The two thing stopping me now are timing and resources.

That is often what holds most people back! At some point you just have to say f it lets do it and put everything aside and make it your sole focus its the only way you will get it up and running. Take your best 2 or 3 ideas and try and look at them as if it was someone else presenting them to you see if you think it would be something worth investing money in. Draw up a business plan see if the revenue is going to make it worth while and it may help you find a few new issues you may not have considered at this point. If one of your parents has a friends whose opinion you trust then maybe ask them for some feedback you could ask your parents but parents have that habit of thinking everything their child does is brilliant so may not be as objective as you need! I started up what was essentially a hobby business when I was around your age and it taught me a lot about business even if it doesn't work out you are bound to learn a lot.

jimmii

hfallada wrote: »

OP if you earn 8k a year. You will pay zero Income tax(16,800 threshold) and USC(12,000 threshold). But you will have to pay a €500 PRSI contribution. If you earn under €5k you wont pay a cent in tax.

Ooops yeh my bad that looks right! Got it into my head it was 5k for everything some how!

Seanf999

jimmii wrote: »

That is often what holds most people back! At some point you just have to say f it lets do it and put everything aside and make it your sole focus its the only way you will get it up and running. Take your best 2 or 3 ideas and try and look at them as if it was someone else presenting them to you see if you think it would be something worth investing money in. Draw up a business plan see if the revenue is going to make it worth while and it may help you find a few new issues you may not have considered at this point. If one of your parents has a friends whose opinion you trust then maybe ask them for some feedback you could ask your parents but parents have that habit of thinking everything their child does is brilliant so may not be as objective as you need! I started up what was essentially a hobby business when I was around your age and it taught me a lot about business even if it doesn't work out you are bound to learn a lot.

My plan firstly is to finish school and take a year to attempt to start a business and see where it gets me, truthfully I would only really want to go to college for a course where 1-I would learn a skill like programming or 2-learn how to handle money properly. Aside from courses the people I meet and experiences could be usefully when starting/maintaining a business.

jimmii

Seanf999 wrote: »

My plan firstly is to finish school and take a year to attempt to start a business and see where it gets me, truthfully I would only really want to go to college for a course where 1-I would learn a skill like programming or 2-learn how to handle money properly. Aside from courses the people I meet and experiences could be usefully when starting/maintaining a business.

Sounds like you really have things together for someone your age fair play. Good luck with it! College/Uni is probably the best place to network as you get to meet so many people who will go off and do such a wide range of things at networking events you often find a lot of people doing quite similar things.

Mrs OBumble

hfallada wrote: »

OP if you earn 8k a year. You will pay zero Income tax(16,800 threshold)

Eh? If they're self-employed they won't get the PAYE tax credit, so surely the threshold is 8k, not 16?

jimmii

Seems safe to say its probably worth talking to an accountant or at least doing an accountancy course! Safe to say most of us don't do our own end of year returns I don't think!