PAYE job as company director

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[berrywell]

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I am a director of a company I started for IT contracting. I recently accepted another job that I will do part time for a few months. However they are offering me a choice of either a daily rate contact or a salaried PAYE position.

The gross for the contract would work out at 21k gross per year, the salary would be 19.5k, however the salaried position also includes 7.5 paid holidays and a 2k pension fund. In addition I theoretically (I'm not sure about this part) would get the PAYE tax credit and not have to pay PRSI on it.

I'm wondering which would be the better choice - the PAYE position looks the best on paper, but will be being a director and engaged in daily rate contracting affect any of the perks or have any hidden costs? Thanks!
 
First of all, it's not as easy as you deciding whether to be treated as an employee or contractor. Revenue have a say.

Luckily, you appear to be getting a better deal as an employee. You're right that the PAYE tax credit will save you Income tax, but it wont save you PRSI.

The 19.5k salary, 7.5 days holidays and €2k pension, PAYE tax credit seems the obvious choice.
 
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