Trying to figure out Byzantine public contract

troyzer

Hi guys, haven't been on here in a while and just want to see what the great collective wisdom of Boards.ie can give me.

I've recently finished my Masters and I'm looking at a job position in an public sector agency. I trawled through the details until I realised that this wasn't a normal job opening.

The job itself is described as a tender. My understanding from the text is that I would be hired on a 12 month graduate programme not as an employee, but as a self employed consultant for which I'd only be paid a fixed daily rate for when I worked. No benefits, no overtime, no holidays, no sick leave or anything.

This is one of the paragraphs from the description:

"Payments will be on foot of appropriate monthly invoices for work completed on a fixed day rate of €120. Reasonable expenses will be paid on a vouched basis only. Professional Services Withholding Tax at 20% may be deducted as required. Depending on particular circumstances, VAT may be applicable. "

Can someone explain to me what professional services withholding tax is? It also states that I'll have to provide a tax clearance certificate.

I think the job would require me to set up my own company. This agency would then pay this company for days worked. I would then have to pay VAT and whatever that PSWT is on that payment and then pay myself a salary from the rest which would then again be liable for personal income tax. Do I have that right?

Is this normal?

Geuze

Think of PSWT as like PAYE on self-employed income, it's a with-holding tax, so you are paying tax in advance of the 31-Oct deadline, in effect.

Mrs OBumble

Not at all normal for someone with quals and no experience. Avoid it, and look for a regular job, IMHO, at this stage in your career. Leave the fixed term contracts for people longer in the tooth who can weight up the risks vs benefits of such arrangements.

troyzer

Geuze wrote: »

Think of PSWT as like PAYE on self-employed income, it's a with-holding tax, so you are paying tax in advance of the 31-Oct deadline, in effect.

So I wouldn't need to have file taxes, keep books and have an accountant sign off on it?

troyzer

Mrs OBumble wrote: »

Not at all normal for someone with quals and no experience. Avoid it, and look for a regular job, IMHO, at this stage in your career. Leave the fixed term contracts for people longer in the tooth who can weight up the risks vs benefits of such arrangements.

I thought it sounded a bit bizarre. I assure you though, this is a graduate only role. Unfortunately, I specialised in a sector where job opportunities are REALLY scarce at the moment so I can't afford to turn it down just because it's a a bit difficult.

Ciaran

troyzer wrote: »

So I wouldn't need to have file taxes, keep books and have an accountant sign off on it?

You would still need to file a tax return as a self-employed person.

Professional Services Withholding Tax is a tax of 20% withheld from payments made by public bodies. You'll get it credited against your income tax bill when you file your tax return.

troyzer

Ciaran wrote: »

You would still need to file a tax return as a self-employed person.

Professional Services Withholding Tax is a tax of 20% withheld from payments made by public bodies. You'll get it credited against your income tax bill when you file your tax return.

I suppose that makes sense. I don't fancy having to pay a chartered accountant though.

Senna

I would not dismiss this position because you have to file a return. An accountant can do it for a few hundred and with a little bit of study you can do it yourself online for free.

Mrs OBumble

Senna wrote: »

I would not dismiss this position because you have to file a return. An accountant can do it for a few hundred and with a little bit of study you can do it yourself online for free.

However lack of automatic eligibility for wefare if he becomes unemployed is pretty harsh.

IMHO self employed contracting is for experienced workers not recent grads.

Senna

Mrs OBumble wrote: »

However lack of automatic eligibility for wefare if he becomes unemployed is pretty harsh.

IMHO self employed contracting is for experienced workers not recent grads.

As I said, I would not dismiss it on ground of having to do a tax return, like the OP seemed to keep referring to.