Taking on 15 year old part time - tax requirements

D

delgirl

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Our business is a partnership (not limited co.) and we intend to take on our 15 year old son (computer genius) to look after our new website and other computer issues.

He will earn 10k per annum and will work on a part-time basis.

Can someone please let me know what the steps are in taking on an employee - I have the Prem Reg form to register as an employer with Revenue, but it doesn't ask for details for the employee.

Are PRSI and PAYE payable on a salary of 10k per annum? If so, do I have to pay monthly?

I can't ask our accountant for advice at the moment, we really can't afford his fees.

Thanks.
 
AKAIK there is no age limit when employing a member of the family and most of the other min wage rules etc don't apply.
 
Your son should apply for tax credits on Form 12A. His Paye and Personal tax credits will be greater than income tax due.
As regards Prsi, your son would be Class M, as long as he remains under the age of 16, and he would not pay Prsi. The partnership, as employer, would have a liabilty at 8.5% of the salary you pay him.
The Revenue will send you a form, probably every month for the first year, which you return with any Prsi liability. At the end of the year you complete Form P35 with details of your son's earnings during the year, number of weeks worked, etc.
 
Gervan said:
The partnership, as employer, would have a liabilty at 8.5% of the salary you pay him.
The Revenue will send you a form, probably every month for the first year, which you return with any Prsi liability. At the end of the year you complete Form P35 with details of your son's earnings during the year, number of weeks worked, etc.
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I did this at the end of 2009 and again last month for 2010.

I've just received a letter back from Social Welfare Services stating that the P35 return for 2009 is either incomplete or there is inaccurate/missing information.

He started work on 1st March 2009 and worked for 10 months. He earned €8,333 for this period. I paid €708 in Employer's PRSI by direct debit each month.

On the P35 for 2009 I entered €8333 as total taxable pay and €708 for Employer PRSI.

Has anyone any idea what they are looking for? Would like to have some idea before I call them.

Thanks
 
delgirl said:
I did this at the end of 2009 and again last month for 2010.

I've just received a letter back from Social Welfare Services stating that the P35 return for 2009 is either incomplete or there is inaccurate/missing information.

He started work on 1st March 2009 and worked for 10 months. He earned €8,333 for this period. I paid €708 in Employer's PRSI by direct debit each month.

On the P35 for 2009 I entered €8333 as total taxable pay and €708 for Employer PRSI.

Has anyone any idea what they are looking for? Would like to have some idea before I call them.

Thanks
Click to expand...

Have you entered his social contribution class and number of weeks?

Fwiw, I don't really understand why you've paid employer PRSI on him. If its a class M employment, there should be no employer PRSI.

http://www.welfare.ie/EN/Publications/SW14/SW14_10/Pages/ClassKandM.aspx
 
T McGibney said:
Have you entered his social contribution class and number of weeks?

Fwiw, I don't really understand why you've paid employer PRSI on him. If its a class M employment, there should be no employer PRSI.

http://www.welfare.ie/EN/Publications/SW14/SW14_10/Pages/ClassKandM.aspx
Click to expand...
I didn't enter the class and number of weeks, just the start date and total taxable pay.

My accountant told me that I'd have to pay 8.5%, he was 16 when employed on 1st March 2009.

He earned €10,000 in 2010 and I paid a total of €852 for 2010.

Sorry, have zero knowledge about PRSI classes etc.
 
delgirl said:
I didn't enter the class and number of weeks, just the start date and total taxable pay.
Click to expand...

This is presumably why the P35 has been rejected.

delgirl said:
I didn't enter the class and number of weeks, just the start date and total taxable pay.

My accountant told me that I'd have to pay 8.5%, he was 16 when employed on 1st March 2009.

He earned €10,000 in 2010 and I paid a total of €852 for 2010.

Sorry, have zero knowledge about PRSI classes etc.
Click to expand...

Sorry, I'm baffled. You mentioned above in May 2009 that you were employing your 15 year old son. You say now that he was 16 on 1 March 2009. Class M (zero PRSI) applies for under-16s - that is why I queried why were you paying employer PRSI.
 
Sorry Tommy, he turned 16 in February 2010 not 2009. So you're correct, he should have been in Class M until February 2010.

That's good news as it means I've overpaid. That's probably why they sent the form.

But it's strange that they didn't notice in 2009.

Thanks for your help.
 
Strange alright. I think you should look into getting a PRSI refund for 2009, at least its worth a try.

If anyone else can assist here, please do...
 
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