Should wife be paying PRSI also?

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cappamj

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My wife is involved in helping me run my small buisness as I am self imployed.
I have paid the self imployed PRSI for myself but nothing for my wife. I get accountant to do paper work once a year to keep everything in order.
He said she should start paying Prsi now towards her pension she is 55. Is this correct? the reason I question it is that on talking to a neighbour(a farmer) he told me his wife can not pay prsi towards her pension that it is not accepted by revenue.
Any advice would be appreciated thanks.
 
cappamj said:
My wife is involved in helping me run my small buisness as I am self imployed.
I have paid the self imployed PRSI for myself but nothing for my wife. I get accountant to do paper work once a year to keep everything in order.
He said she should start paying Prsi now towards her pension she is 55. Is this correct? the reason I question it is that on talking to a neighbour(a farmer) he told me his wife can not pay prsi towards her pension that it is not accepted by revenue.
Any advice would be appreciated thanks.
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do you pay her anything ?
 
we do not take a wage out of buisness just live on any profit, i have almost retired from it (building) but have rental properties which we have to upkeep etc.
 
ClubMan said:
Isn't living off the profit the same as taking a wage?
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Kind of.

Many self employed people think that what they take out of the business is their wages and should be taxed accordingly. Self empoyed people are taxed on their profits. So if you make a profit of 100K but only take 30K out of the business bank account for yourself it's always the 100K that is taxable.
 
Your accounts/tax return should state that the business is a partnership. So instead of Mr Joe Bloggs it should be Mr Joe & Mrs Jane Bloggs.

Ok my tax is a bit rusty but as far as I know the situation should be as follows:

The profit should be split. Give your wife a % of the profits in the accounts (no money will change hands) and you should be jointly assessed. .Eg...Your profits are €50K. Instead of you being taxed on 50K per your tax return , it should show you assessed on say 40K and your wife assessed on say 10K. (you accountant will be able to advise the proper %)

Then instead of you paying PRSI on 50K, you will pay Prsi on 40K and your wife on 10K...it should work out at roughly the same.

You should arrange to have your accountant explain all this to both of you.
 
thank you, will talk to accountant.

At the moment we are down as a partnership and started paying PrsI for my wife last year. The PRSI amount was equal for both of us -- IE self employed rates.
 
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