Company Directors & the PAYE tax credit

All I'm doing is pointing out to the original poster that as a director he can claim certain expenses tax free which can ease the pain of losing the PAYE tax credit. From my rant above, its clear that I think he is more than entitled to do so.
 
leghorn said:
I would suggest that if you're 100% straight laced, with no grey areas, you'll still get crucified.
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FWIW I have had two clients recently who were subjected to comprehensive Revenue Audits across all tax heads including directors own returns. In both cases Revenue walked away empty handed. ( despite there being some, albeit not many, grey areas ) I can only attest to fair and level handedness in Revenue's dealings with those cases.
 
A receipt is not required.
A signed worksheet from the work carried out proves I was in the area.

€144.45 tax free

Where can I read that, to be sure, please ?
 
Thanks a lot Hikicker for the very useful info, just wonering there are A cass and B class, what is the defference beetwen them ?
 
hikicker said:
Ubiquitous, I'd like to point out that as a company director of a company started up in the past 5 years I:

Am not entitled to a PAYE Tax credit
Will not be entitled to social welfare should the company fail
pay tax on my income, dividends and company profits
pay vat in advance of actually receiving payment for invoices
Pay preliminary corporation tax in advance of making any company profit
Have invested and risked my own money (which had already been taxed as paye income)
Pay rates, water charges, and inflated waste charges.
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Sorry for bumping the thread, but I noticed something that alarmed me a little.

I started a company within the last year, own 100%, and am one of two directors. I am an employee of the company and pay PAYE and PRSI. Is it true that if my company fails I would not be entitled to social welfare?? This struck me as odd. Am I misunderstanding something?
 
As also stated in previous posts on this topic, your company can always develop a symbiotic relationship with another company with similar owner/directors, who are also not entitled to the PAYE credit. If your comany can justify employing that owner/director as an employee and can pay him/her just enough gross income (should be around €5k p.a. I think) to cover the PAYE credit, and his/her company can also justify doing the same for you, this will enable each owner/director to build up the necessary Class A PRSI record as an employee to enable social welfare entitlements. Each company can reduce the gross salary payable to its own owner/director by the amount it pays to the other individual, so that it's mostly cost neutral. However, as also stated previously, there must be a genuine service provided in exchange for the salary!! If there was no service provided, I am sure it would be disallowed, but if a service is provided (creata a contract of employment for example) your company (and theirs) can hire anyone they like to provide this service.
 
Graham_07 said:
FWIW I have had two clients recently who were subjected to comprehensive Revenue Audits across all tax heads including directors own returns. In both cases Revenue walked away empty handed. ( despite there being some, albeit not many, grey areas ) I can only attest to fair and level handedness in Revenue's dealings with those cases.
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My own experience in relation to recent audits has been similar to this.
 
Not that it's much but every little helps, remember that as an employer/employee you can give yourself a €250 "bonus" at Christmas (well anytime actually but only once a year) without paying PAYE/PRSI. The only condition is that the payment must be in vouchers and a receipt for the vouchers kept.
 
Lobby said:
Not that it's much but every little helps, remember that as an employer/employee you can give yourself a €250 "bonus" at Christmas (well anytime actually but only once a year) without paying PAYE/PRSI. The only condition is that the payment must be in vouchers and a receipt for the vouchers kept.
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I wouldn't take this as absolute gospel, if I were you. At best, its application to proprietary company directors is a grey area.
 
ubiquitous said:
I wouldn't take this as absolute gospel, if I were you. At best, its application to proprietary company directors is a grey area.
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From http://www.revenue.ie/en/tax/it/leaflets/benefit-in-kind/overview.html#section3

"Where an employer provides an employee with a small benefit (that is, a benefit with a value not exceeding €250 (€100 up to 31st December 2004), PAYE and PRSI need not be applied to that benefit. This treatment does not apply to cash payments, which are taxable in full. No more than one such benefit given to an employee in a tax year will qualify for such treatment. Where a benefit exceeds €250 in value the full value of the benefit is to be subjected to PAYE and PRSI."

I admit there's no mention of the position wrt directors as employees, but I doubt the revenue would squabble over €250 once a year. Neither does my auditor.

Why do you think otherwise? (Sorry slightly OT)
 
Lobby said:
I admit there's no mention of the position wrt directors as employees, but I doubt the revenue would squabble over €250 once a year. Neither does my auditor.
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Well if you're happy to take the risk, fair play to you. I just don't think its worth risking getting on the wrong side of the Revenue for the sake of such a small benefit, given that it is a grey area. And, yes, I have seem Revenue audit officials getting their knickers in a twist over similarly tiny sums.

(Btw, why are you not availing of audit exemption? This would save you much more than the tax on €250.)
 
I can't avail of audit exemption - sadly not for the turnover amount though! It's required for membership of IAVI.
 
Hi all,

Very interesting thread. I did not know that if the company fails you are not entitled to PRSI. What does it mean "fail" in this context?

I was thinking in closing my company next year as we are going back to our country. Is that considered "failure"?

Cheers.
 
churrusco said:
Hi all,

Very interesting thread. I did not know that if the company fails you are not entitled to PRSI. What does it mean "fail" in this context?

I was thinking in closing my company next year as we are going back to our country. Is that considered "failure"?

Cheers.
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Class S contributions mean that you do not get any Jobseekers benefit if you are not employed. So if the company ceases paying you through it ceasing to trade (for whatever reason), you cannot apply for a Social Welfare unemployment payment using Class S. You may, depending on means testing etc. qualify for some form of social welfare assistance.
 
churrusco said:
Hi all,

What does it mean "fail" in this context?

I was thinking in closing my company next year as we are going back to our country. Is that considered "failure"?

Cheers.
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Best of luck back home. I hope some day that Ireland will again be attractive enough to make people want to come to our country to work and live.
 
OT: Thanks simplyjoe. Do not worry it is still attractive enough. It is only that the weather is not so attractive to the female genre ;)
 
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