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Very small business accountant + tax infos needed

  • 17-08-2016 9:34am
    #1
    Registered Users Posts: 12 ✭✭✭ Flatlinezor


    Hello!

    I have been doing several trips to Revenue in the city of Galway and some things are still not clear. Please if anyone can help/offer services/recommend services, please do so.

    I am a single individual, a full time employee where I get over the 40% tax band rate by my salary there alone and they pay FULL PRSI and everything obviously. I founded a company here in Ireland beside my full employment and I am the only employee of that company, the director. Being self employed there and paying myself a very low amount of 500 euros per month. I have already let revenue know I am working there "as well" and according to them the next time I have to care about tax for me as an individual will be next October (2017 October) which is okay and I understand that, to self-assess for the 2016 period. The company I founded (2016 May) I employ myself only from June 2016 so that will be a 7 months period of 500 euros.

    I am registered for VAT through the company since it is a Limited company. Now, the VAT return filings are new to me, I just got a letter from the collector comissioner that I missed the first 2 month period. I called them, I apologized since this is all new to me (and I had only selling/purchasing to EU countries so I am NIL to report in all that regard) and I have initiated to do a ROS profile for the company (and myself as well as an individual for next October's income tax filings). The VAT filings should be straightforward enough because:

    I am using an online payroll and accounting software. Basically all my invoices and purchase invoices are kept and I have all bank statements and everything neatly tracked in the software, it even can do VAT return details.

    So basically my question is, first of all Revenue told me there is a new thing in 2016 which allows me as being self employed to not have to tax the first 3500 EUR on my income which sounds superb but I don't find any sign of that online but they assured me it is not the single individual + paye tax credit. I had the assumption that since I am over 40% band rate already through my main employment, all the income I am gonna get from being Self Employed will be taxed 40% immediately. Bear in mind that if that is true, I am absolutely shocked anyone would wanna do something extra because it is just not worth the effort since the government takes half of it.. If that 3500 "tax credit" of some sort as a self employed individual is really something that exists, can someone tell me what is it?

    Also, about PRSI. I am the director in my company, how does that differ in a way payroll runs should be done? I think all I should do is to pay CLASS S PRSI on the 500 per month and the USC and that is it. Am I correct in this? Also, if getting a salary of 500 would mean I lose most of it, is there a way to somehow transfer that to pay me out in dividends, or any other way that might be better for tax purposes? I have no shares in the company but it can be arranged of course if needed. (The owner of the company has 100% of the shares but he is not involved in day to day operations, I am basically the boss.)

    I don't mind paying for someone to look over these. The company basically deals with outsourcing 3D Modeling work throughout Europe, so basically I have 10-12 invoices a year having a turnover of 100k approximately, I am as of a conductor that connects demand for 3D work with supply from artists all around Europe. The purchase invoices the same, whatever I sell I obviously buy lower and the remaining money is profit which I will tax as 12% as far as I know next October for the 2016 period. Is this correct as well? Apart from Corporation tax, will I need to pay anything else?

    Much appreciated guys, hopefully someone ha some insight....


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