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started up in 2014, when to pay tax? Also sub contracting tax

  • 12-09-2015 8:45am
    #1
    shugy
    Banned (with Prison Access) Posts: 409 ✭✭


    I started up as a sole trader in oct 2014 and its coming up to pay my tax in oct but ive been told i can leave paying my tax untill 2016 instead of this year seeing as its my first year of trading, just wanting to know is this possible.


    Another thing, im looking info on is sub contracting. If i take on a sub contract for talks sake for 10k and im looking to sub contract out some of the work, do i just pass on the 20% income tax or do i pay 20% and the sub contractor below me also have to pay 20% and this way, theres 40% taken from the 10k.


Comments

  • #2
    barneystinson
    Registered Users, Registered Users 2 Posts: 4,685 ✭✭✭barneystinson


    shugy wrote: »
    I started up as a sole trader in oct 2014 and its coming up to pay my tax in oct but ive been told i can leave paying my tax untill 2016 instead of this year seeing as its my first year of trading, just wanting to know is this possible.


    Another thing, im looking info on is sub contracting. If i take on a sub contract for talks sake for 10k and im looking to sub contract out some of the work, do i just pass on the 20% income tax or do i pay 20% and the sub contractor below me also have to pay 20% and this way, theres 40% taken from the 10k.

    Jaysus. I can't believe this old chestnut is still floating around.

    You have two separate obligations in the self assessment tax system, hence the name PAY and FILE.

    You are obliged to PAY your 2014 tax liability by 31/10/2015.

    If you only started self employment in 2014 you have an extra to FILE your tax return, so you can hold off on making your 2014 tax return until 31/10/2016 (ie file 2014 return and 2015 return together).

    However, since you are obliged to pay your 2014 tax in full by 31/10/2015 that effectively means you need to have done your accounts and calculated the tax due, so you'd be as well off to just file the return too...


  • #3
    sinah
    Registered Users, Registered Users 2 Posts: 2 ✭sinah


    Another thing, im looking info on is sub contracting. If i take on a sub contract for talks sake for 10k and im looking to sub contract out some of the work, do i just pass on the 20% income tax or do i pay 20% and the sub contractor below me also have to pay 20% and this way, theres 40% taken from the 10k.[/QUOTE]

    You would apply the rate that revenue set for your subcontractor i.e. 0, 20 or 35%, you'd get this rate when you register the contract on ros.

    If you are due to be paid 10k and are on a 20% rate you will get 8k and 2k will be held in revenue. If you subcontract out the work and your sub is due to get 1k then you will put the 1k into rct system on ros and if he is on 20% then you pay revenue 200 and the sub 800. If you are already after having money deducted off you by your principal then that 200 can be deducted out of your money that is held.


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