contract Day rate Full time employment vs contracting.

Google the Icon Accounting tax calculator.

Input your daily rate. Generally put in 18 working days to account for bank Holidays, time off etc.

You can claim all of the above up to certain limits.

I on charges a low enough monthly fee to process your payroll etc.

Yes

you will need to setup your own business and run it that way. Business bank account and pay yourself your wages from it. You can also pay your wife to manage the books from the business account.

Also as she’s an employee you can also benefit from 2x500 euro gift vouchers per year (handy at Christmas)

I actually kind of miss contracting. I didn’t setup my own business I hired a company (contracting plus) to manage my taxes and I was setup as a PAYE employee of an umbrella company but if I was contracting again I’d go the other way and pay my own taxes and setup my own business as there is ways you can avoid taxes etc.

If you're a sole trader you can't employ your wife. You need to be a limited company to do that. You can do your own limited company set up rather than going down the umbrella company route.

This is correct.

Ltd Co- employ spouse, can often make larger pension contributions. However you've to file an income tax return and Corporation Tax Return with Revenue and B1 Annual Return to the CRO.

Sole trader only files an income tax return. Has no limited liability but shouldn't be an issue in your field. Can't employ spouse/family. Pension contributions are limited to a % of your income (depending on your age).

Class S PRSI for a company director doesn't incur any employers PRSI

I'd want to be looking at a contract rate equivalent to 80-90k a year after holidays to think about that really. If you setup a limited company there are overheads of running that per year, it's costing me around 3k currently. Is the 60k just the base salary? Would there be a bonus, pension contributions, health insurance, stock options etc? There is a possible recession coming too, maybe not a great time to be moving into contracting either. I've heard anecdotal evidence of revenue cracking down on one man companies employing their spouse to do nothing too.

As a sole trader, diesel costs and car maintenance are not allowable if they are incurred when travelling between home and your normal place of work i.e your commute to work.

As a limited company, if this is claimed as an expense it would then be treated as benefit in kind. Expenses relating to travel to a temporary place of work are allowed to be claimed.

Correct. But it only gets you a class-S "stamp". So it counts towards eligibility for Maternity Benefit and pension, and not a lot else.

If the poster wants to keep their eligibility for all welfare benefits (eg in case they get sick or the work dries up), they need class A paid. And that will cost the employer-contribution rate, no matter whether it's done thru an umbrella company or a sole trader voluntarily paying class A. (I'm told the latter is possible, but have never found out how to actually do it).

Also, as a contractor, if the work dries up or the company is sold, you get no redundancy or TUPE rights. You can be dumped out with little warning, and no compensation. The contract rate needs to be high enough to make it worth taking this risk. The more I think about this (with the economy heading into a recession), an extra 10k for contracting is just insulting.

Yes you can set up a Ltd Co. Your company would then employ you (and you can pay employers PRSI to cover your PRSI query).

The company can then make executive/directors pension contributions which will qualify as a tax deductible expense for the business.

Your company could pay you the €3.20 work from home allowance free of tax, that covers your heating/broadband query. Company can also pay for a mobile.

Mileage would be based on civil service rates but can't be claimed for a commute (also if you're working from home then no mileage).

You'll be providing a service and earning over €37,500 so you would have to register for VAT.

Ltd Co pros - higher pension contributions than a sole trader

Ltd Co cons - must file Corporation Tax return and Annual Return to CRO as well as income tax return. Therefore extra bureaucracy and cost.

And kites being flown about raising this limit to €1,000 which will be even nicer again. If you have a Ltd Co you could also employ your spouse to assist with your admin, which may be beneficial depending on their income.

Hi OP

lf it's your first time going down this route I would really advise going the umbrella route using someone like Contracting Plus or as others suggested Icon.

They really do take all the hassle out of it and you still get many of the tax benefits.

Once you find your feet in the contracting world you could go it alone.

Just on expensing everything which seems to crop up quite a bit with these questions. The expenses incurred must be real and wholly, necessarily and exclusively incurred for your business activities to be allowable.

500 is worth it in my opinion especially if there is scope for a bit of over time and the company has a good reputation for flexible working hours. Check glassdoor for company reviews.

The pension plans are not actually being stopped by the change. They just have to be audited. The fear is the cost of the audits make them unviable.

Definitely get an accountant or work with the likes of Icon accounting or the others that were mentioned previously. It sounds like you are looking to save money on the bookkeeping and accounting by doing it yourself but if you're asking these kind of questions you are quite a way from having enough of an understanding of it. The penalty for getting this wrong can be disastrous.