Hi all,
Does one fall foul of The Revenue in any way by changing from a PAYE employee to a LTD company contractor (contracted to the SAME former employer), and deliberately reducing your salary so that you can put more funds from your LTD company into your pension.
For example if earning 90k per annum PAYE but then subsequently only paying yourself 40k per annum as a contractor but putting the remaining LTD company funds into pension to reduce Income Tax, PRSI, USC.
I know there is the 'Salary Sacrifice' scenario where a PAYE employee deliberately arranges with their employer to reduce their salary from the (say) 90K to 40k per annum and that this would be considered a Benefit In Kind for the PAYE employee. But what about the 'PAYE to LTD company contractor with former employer' scenario? Is this alllowed?
Turing
Does one fall foul of The Revenue in any way by changing from a PAYE employee to a LTD company contractor (contracted to the SAME former employer), and deliberately reducing your salary so that you can put more funds from your LTD company into your pension.
For example if earning 90k per annum PAYE but then subsequently only paying yourself 40k per annum as a contractor but putting the remaining LTD company funds into pension to reduce Income Tax, PRSI, USC.
I know there is the 'Salary Sacrifice' scenario where a PAYE employee deliberately arranges with their employer to reduce their salary from the (say) 90K to 40k per annum and that this would be considered a Benefit In Kind for the PAYE employee. But what about the 'PAYE to LTD company contractor with former employer' scenario? Is this alllowed?
Turing