Joining husbands business - PAYE or contract

Minxie123

Hi All

I'm hoping for some advice. My husband has a business (sole trader)

I am going to give up my PAYE job to go and work for him. Can anyone tell me what the best way to do this is.

Is he better off employing me as a paye worker or would I be better off setting myself up with a contracting company and basically invoicing him for the work I do?

Thanks in advance.

jimmii

What is going to be the most tax efficient is going to depend on your personal circumstances. The best thing to do is talk to an accountant.

Minxie123

Thanks for the reply. I'll certainly be checking with the accountant. i think I was just hoping someone had done something similar and advise how it went for them.

Pro Hoc Vice

Minxie123 wrote: »

Thanks for the reply. I'll certainly be checking with the accountant. i think I was just hoping someone had done something similar and advise how it went for them.

One thing to consider is if you are employed by him you do not pay any PRSI if I remember the disadvantage to this is you do not have any "stamps" towards your own contributory pension. Each person's circumstances are different so best to take advice.

jimmii

Minxie123 wrote: »

Thanks for the reply. I'll certainly be checking with the accountant. i think I was just hoping someone had done something similar and advise how it went for them.

My wife and I went as a partnership initially and have now changed to being directors of an Ltd. There isn't really a massive difference to be honest. The most important thing is that you have your roles defined and be sure you can actually work together it's not as easy as it seems!

Gloomtastic!

A bit of light reading for you to determine whether you can qualify as a contractor or an employee.
http://www.revenue.ie/en/tax/it/leaflets/code-of-practice-on-employment-status.pdf

If you could sell your services to at least two other companies in a single tax year it would it easier.

Working with the wife? I'd be on a murder charge within a week! :rolleyes:

Minxie123

Pro Hoc Vice wrote: »

One thing to consider is if you are employed by him you do not pay any PRSI if I remember the disadvantage to this is you do not have any "stamps" towards your own contributory pension. Each person's circumstances are different so best to take advice.

Oh yes, I totally agree. I live in fear of "breaking my stamps"!

jimmii

Gloomtastic! wrote: »

A bit of light reading for you to determine whether you can qualify as a contractor or an employee.
http://www.revenue.ie/en/tax/it/leaflets/code-of-practice-on-employment-status.pdf

If you could sell your services to at least two other companies in a single tax year it would it easier.

Working with the wife? I'd be on a murder charge within a week! :rolleyes:

Working with your wife is good because you can say how you really feel but it's also bad because you've just said how you really feel!

Minxie123

jimmii wrote: »

My wife and I went as a partnership initially and have now changed to being directors of an Ltd. There isn't really a massive difference to be honest. The most important thing is that you have your roles defined and be sure you can actually work together it's not as easy as it seems!

Thanks for that. Yes, while I'm really excited to be getting on board I do worry about how it will all work out personally. I think we'll be ok though. We won't be physically working together, as in together in an office all day long but he is now going to be my boss so there will be a bit of getting used to that

jimmii

Minxie123 wrote: »

Thanks for that. Yes, while I'm really excited to be getting on board I do worry about how it will all work out personally. I think we'll be ok though. We won't be physically working together, as in together in an office all day long but he is now going to be my boss so there will be a bit of getting used to that

That's not so bad then. We've been working together for the last few years. We're both very laid back though which helps. Just treat work as work and it'll be fine.

Mrs OBumble

Pro Hoc Vice wrote: »

One thing to consider is if you are employed by him you do not pay any PRSI if I remember the disadvantage to this is you do not have any "stamps" towards your own contributory pension. Each person's circumstances are different so best to take advice.

Check with the accountant, but it may be possible for him to voluntarily pay PRSI for you, even though it's not required.