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how would this work

  • 13-03-2016 8:19pm
    #1
    soccercrew
    Registered Users, Registered Users 2 Posts: 116 ✭✭


    Im a sole trader and run my own handyman/building type business where i can be building garden walls either by stone, block and plaster. I do internal skimming, tiling and bathroom refits. I sometimes do painting and concrete footpaths.

    What i want to know is if i get any jobs where i need help as in a labour or even calling on other tradesmen to come in and help me. For example, if i get a small house to skim out or even build a large stone wall and need to bring in some help, do i pay their tax or they pay their own. If i price the job for 150 aday for me and 80 for labourer and 150 for another plasterer, and at the end of the job we have 1500/1500/800. Do i have to take their tax out of it or is it up to them to pay it.

    Or vise versa, if i get called into help a tradesman on a job and i get paid 1500 for 10days work, do i tell him to pay my income tax or pay it myself.

    Just thought id ask incase i need help and end up shooting myself in the foot in tax.


Comments

  • #2
    Lockedout2
    Registered Users, Registered Users 2 Posts: 402 ✭✭Lockedout2


    You either pay them as an employee or a sub contractor.

    Here is the guidance revenue.ie/. en/tax/rct/determining-the-correct-employment-status-of-a-worker.html

    The obligation is on you to ensure that they are self employed if you treat them as such. Remember RCT applies if PAYE does not.


  • #3
    soccercrew
    Registered Users, Registered Users 2 Posts: 116 ✭✭soccercrew


    Lockedout2 wrote: »
    You either pay them as an employee or a sub contractor.

    Here is the guidance revenue.ie/. en/tax/rct/determining-the-correct-employment-status-of-a-worker.html

    The obligation is on you to ensure that they are self employed if you treat them as such. Remember RCT applies if PAYE does not.


    So basicly I pay 20% rct on the job to revenue even if they are self employed. I don't give it to them, I pay revenue it after each job.


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


    soccercrew wrote: »
    So basicly I pay 20% rct on the job to revenue even if they are self employed. I don't give it to them, I pay revenue it after each job.

    No, what they're saying is it's up to you to decide whether they are an employee or a subcontractor and apply the correct tax system. RCT can be 0%, 20% or 35%, the eRCT system tells you what rate to deduct when you tell it you're making a payment to a subbie.

    Getting it wrong could be quite costly, so tread carefully, probably be a good idea to talk to your accountant.


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