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Own Business - am I my own employee?

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  • 25-02-2017 4:49pm
    #1
    Ally Dick
    Registered Users Posts: 12,668 ✭✭✭✭


    I set up a limited company for IT contracting. I am the sole director. My wife is the secretary. She is not getting a salary as she is only there in name only. I have been set up for ROS and have an accountant on board for assistance. I understand the ROS system regarding VAT, but I am not sure what I am doing regarding PAYE. If I take money out of the business account, is that in effect wages that I must pay tax, PRSI and USC on? Does the PRSI that I pay go down against me as the employee under my private PPS number? Is this PRSI class S or is it A? If I wound up the company and was unemployed, would I be entitled to job seekers, because the employee side of me was after "paying" PRSI? When you fill in ROS, are you expected to know the amounts to put in for the P30 e.g the rate of tax, the rate of USC etc, and know what the accumulated figure should be regarding thresholds etc? Sorry for all the questions. I am just confused about this bit


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    #2
    Lockedout2
    Registered Users Posts: 402 ✭✭Lockedout2


    The company is the employer and you are the employee.

    If the company pays you a salary then it should apply for a cert of tax credit and standard rate cut off and operate PAYE based on that.

    It should remit the PAYE/PRSI/USC to the Collector General each month.

    PRSI is class S.

    Get an accountant.


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    #3
    Phibsboro7
    Registered Users Posts: 24 ✭Phibsboro7


    Lockedout2 wrote: »
    The company is the employer and you are the employee.

    If the company pays you a salary then it should apply for a cert of tax credit and standard rate cut off and operate PAYE based on that.

    It should remit the PAYE/PRSI/USC to the Collector General each month.

    PRSI is class S.

    Get an accountant.

    I agree with this advice 100%. You are an employee. You will need an accountant to file with the CRO and for tax purposes. It's more complicated with a DAC/Ltd Company than as a sole trader unfortunately.


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    #4
    Ally Dick
    Registered Users Posts: 12,668 ✭✭✭✭Ally Dick


    Thanks for the responses. I have an accountant, but he threw me by telling me to get a ROS log in and file VAT bimonthly and PAYE/PRSI/USC monthly. In fairness, he said I could ring him for assistance. I am scared by ROS, especially as I have to think of myself as a company director with obligations, and a self employed employee. I'm afraid of making a mistake!


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    #5
    Ally Dick
    Registered Users Posts: 12,668 ✭✭✭✭Ally Dick


    I have registered with Sage Payroll online to try and make things less complicated


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    #6
    PARlance
    Registered Users Posts: 21,096 ✭✭✭✭PARlance


    Ally Dick wrote: »
    I have registered with Sage Payroll online to try and make things less complicated

    Your accountant may be able to look after the payroll side of things for you. Failing that there are plenty of providers out there too.

    It'll cost a little but it might be worth it if you're worried or stressed about it. Lots of small companies outsource it.


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    #7
    Phibsboro7
    Registered Users Posts: 24 ✭Phibsboro7


    PARlance wrote: »
    Your accountant may be able to look after the payroll side of things for you. Failing that there are plenty of providers out there too.

    It'll cost a little but it might be worth it if you're worried or stressed about it. Lots of small companies outsource it.

    I would also say from my experience that Revenue are very reasonable when dealing with a self-employed individual who they believe are doing the best they can. Don't be afraid of them, they are people too and are actually happy to help. It's only those who are deliberately trying to avoid paying tax who need to avoid them. I've had them phoning at 8 in the evening, trying to sort out situations.


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    #8
    PARlance
    Registered Users Posts: 21,096 ✭✭✭✭PARlance


    Phibsboro7 wrote: »
    I would also say from my experience that Revenue are very reasonable when dealing with a self-employed individual who they believe are doing the best they can. Don't be afraid of them, they are people too and are actually happy to help. It's only those who are deliberately trying to avoid paying tax who need to avoid them. I've had them phoning at 8 in the evening, trying to sort out situations.

    I almost believed you until you said 8 in the evening :)

    Yip, they are generally very good to deal with as long as you communicate with them.


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    #9
    Victor
    Registered Users Posts: 78,281 ✭✭✭✭Victor


    Ally Dick wrote: »
    I am scared by ROS, especially as I have to think of myself as a company director with obligations, and a self employed employee. I'm afraid of making a mistake!
    You are a special class of employee known as a company director. You are not self employed.


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    #10
    srsly78
    Registered Users Posts: 7,157 ✭✭✭srsly78


    A proprietary company director does count as self-employed. But they still pay PAYE so go figure. Note that this also means you must file a personal tax return each year.


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    #11
    pilly
    Banned (with Prison Access) Posts: 9,005 ✭✭✭pilly


    Hi Ally, I think you really need to go back to your accountant and tell him you're not comfortable with preparing your own returns. They can do it for you and also run the wages.

    You need to pay yourself a wage and it would appear you don't have much experience in the finance side of things so just let them do it for you. The charge for this wouldn't be very much.


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    #12
    Ally Dick
    Registered Users Posts: 12,668 ✭✭✭✭Ally Dick


    May I ask, do I have to have an Employers Registration Number to pay "myself" through Sage One payroll? Sorry for the constant questions


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    #13
    CIARAN_BOYLE
    Moderators, Sports Moderators Posts: 14,599 Mod ✭✭✭✭CIARAN_BOYLE


    Ally Dick wrote: »
    May I ask, do I have to have an Employers Registration Number to pay "myself" through Sage One payroll? Sorry for the constant questions

    You have to be registered as an employer. Your employer registration number will probably be your company tax number.


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    #14
    Graham
    Moderators, Society & Culture Moderators Posts: 17,642 Mod ✭✭✭✭Graham


    There are accountants that specialise in IT contractors. Go and find one of them. You'll find they're much more aligned with your requirements (and experience) than a general accountancy practice.

    For a fairly reasonable monthly fee they will look after everything including your expense claims, VAT, PAYE, annual returns.


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