Advertisement
If you have a new account but are having problems posting or verifying your account, please email us on hello@boards.ie for help. Thanks :)
Hello all! Please ensure that you are posting a new thread or question in the appropriate forum. The Feedback forum is overwhelmed with questions that are having to be moved elsewhere. If you need help to verify your account contact hello@boards.ie

IT contracting and tax advice

Options
2»

Comments

  • Options
    #32
    Calahonda52
    Registered Users Posts: 12,235 ✭✭✭✭Calahonda52


    why is the child company option giving you more take home pay?
    The revenue clampdown is a smoke screen: exactly what sort of thing?

    “I can’t pay my staff or mortgage with instagram likes”.



  • Options
    #33
    un5byh7sqpd2x0
    Closed Accounts Posts: 1,862 ✭✭✭un5byh7sqpd2x0


    Calahonda52 wrote: »
    why is the child company option giving you more take home pay?
    The revenue clampdown is a smoke screen: exactly what sort of thing?

    No employer PRSI is why, there’s nothing dodgy about being a director or an umbrella company.


  • Options
    #34
    MegamanBoo
    Registered Users Posts: 2,209 ✭✭✭MegamanBoo


    Calahonda52 wrote: »
    The revenue clampdown is a smoke screen: exactly what sort of thing?

    I've just double checked and basically I'd be joining an existing company as a director/shareholder.

    And yes it looks like the savings come on employer prsi


  • Options
    #35
    Calahonda52
    Registered Users Posts: 12,235 ✭✭✭✭Calahonda52


    Brenda Rancid Topaz wrote: »
    No employer PRSI is why, there’s nothing dodgy about being a director or an umbrella company.

    None or reduced?
    https://www.robertsnathan.com/payeprsi-key-points-note-company-directors-self-employed/
    3. PRSI for Company Directors

    Another important factor to consider as a company director is Employer’s PRSI. The rules surrounding the application of a PRSI class on salaries paid to directors are not as clear as they are for PAYE. Under Section 16 of the Social Welfare and Pensions (Miscellaneous Provisions) Act 2013, proprietary directors who own or control 50% or more of the shareholding of a company, whether directly or indirectly, are subject to PRSI under Class S, which is currently 4% of gross income.

    The PRSI Class applicable to proprietary directors owning or controlling less than 50% of the shareholding of a company, is determined on a case by case basis, by the Scope Section of the Department of Social Protection.

    As Class S employments are not subject to Employer’s PRSI, which can be charged at either 8.5% or 10.75%, (as at 15th January 2015), there is a significant saving for companies on salaries paid to directors under PRSI Class S.


    What State pension comes with Class S?

    “I can’t pay my staff or mortgage with instagram likes”.



  • Options
    #36
    un5byh7sqpd2x0
    Closed Accounts Posts: 1,862 ✭✭✭un5byh7sqpd2x0


    Calahonda52 wrote: »
    None or reduced?
    https://www.robertsnathan.com/payeprsi-key-points-note-company-directors-self-employed/
    3. PRSI for Company Directors

    Another important factor to consider as a company director is Employer’s PRSI. The rules surrounding the application of a PRSI class on salaries paid to directors are not as clear as they are for PAYE. Under Section 16 of the Social Welfare and Pensions (Miscellaneous Provisions) Act 2013, proprietary directors who own or control 50% or more of the shareholding of a company, whether directly or indirectly, are subject to PRSI under Class S, which is currently 4% of gross income.

    The PRSI Class applicable to proprietary directors owning or controlling less than 50% of the shareholding of a company, is determined on a case by case basis, by the Scope Section of the Department of Social Protection.

    As Class S employments are not subject to Employer’s PRSI, which can be charged at either 8.5% or 10.75%, (as at 15th January 2015), there is a significant saving for companies on salaries paid to directors under PRSI Class S.


    What State pension comes with Class S?

    No employers PRSI. Zero. Nada. Not reduced, but none at all. 0%. It’s in the last paragraph of your quote.

    State pension on Class S PRSI is the full regular amount.


  • Advertisement
  • Options
    #37
    Calahonda52
    Registered Users Posts: 12,235 ✭✭✭✭Calahonda52


    DM, Thanks for this!
    Where is the catch? :)

    “I can’t pay my staff or mortgage with instagram likes”.



  • Options
    #38
    un5byh7sqpd2x0
    Closed Accounts Posts: 1,862 ✭✭✭un5byh7sqpd2x0


    Calahonda52 wrote: »
    DM, Thanks for this!
    Where is the catch? :)

    Job security?


  • Options
    #39
    retalivity
    Registered Users Posts: 14,064 ✭✭✭✭retalivity


    Calahonda52 wrote: »
    DM, Thanks for this!
    Where is the catch? :)

    There used to be something about not getting the dole if you were an umbrella director and between contracts - you could claim it if you were an umbrella employee. Think that may have changed in recent years with legislation


  • Options
    #40
    Calahonda52
    Registered Users Posts: 12,235 ✭✭✭✭Calahonda52


    retalivity wrote: »
    There used to be something about not getting the dole if you were an umbrella director and between contracts - you could claim it if you were an umbrella employee. Think that may have changed in recent years with legislation

    Looks correct

    Class S contributions only cover you for a limited number of payments. In general, they do not cover you for any short-term payments including illness and disability payments. If you satisfy all the other conditions, Class S contributions can entitle you to:

    Maternity Benefit
    Adoptive Benefit
    Paternity Benefit
    Parent's Benefit
    Widow's, Widower's or Surviving Civil Partner's (Contributory) Pension
    State Pension (Contributory)
    Treatment Benefit Scheme
    Invalidity Pension
    Jobseeker's Benefit (Self-Employed)
    Guardian's Payment (Contributory)

    My question was why would the system allow you pay no PRSI and still get nearly the full range of state benefits?

    “I can’t pay my staff or mortgage with instagram likes”.



  • Options
    #41
    WacoKid
    Registered Users Posts: 433 ✭✭WacoKid


    My 2 cents:

    Set up your own company and business bank accounts
    Hire an accountant to do your payslips and end of year accounts only
    Do everything lese yourself on www.ros.ie (PAYE, VAT), takes a few mins every few months
    Nobody else can touch or see your money, or your accounts
    Gives you greatest flexibility with your money


  • Advertisement
Advertisement