Part-time work advice query

[Luckenbach]

Hi all, a friend of mine is offering me part-time work. Approx 5-6 hours a week. He has a small company (5 employees). I already have a full-time PAYE occupation so trying to figure out if I should ask him to pay me as a part-time PAYE worker or should I set up as a sole trader? I wouldn't be doing this work for anyone else.

I'm leaning toward the PAYE route as I don't think I can justify the expense of an accountant, setup costs etc on those hours.

Any advice gratefully appreciated.

 

[T McGibney]

Hi all, a friend of mine is offering me part-time work. Approx 5-6 hours a week. He has a small company (5 employees). I already have a full-time PAYE occupation so trying to figure out if I should ask him to pay me as a part-time PAYE worker or should I set up as a sole trader? I wouldn't be doing this work for anyone else.

Unless you're really keen on walking yourself and your friend into trouble, don't under any circumstances confect a bogus self-employment arrangement.

 

[Luckenbach]

Unless you're really keen on walking yourself and your friend into trouble, don't under any circumstances confect a bogus self-employment arrangement.

Thanks for the reply. Not sure what you mean by bogus self-employment arrangement. Presumably the sole trader arrangement I suggested isn't legal? If that's the case, then I'll go down the PAYE route and let him figure out the workings of it. Thanks again

 

[T McGibney]

Thanks for the reply. Not sure what you mean by bogus self-employment arrangement. Presumably the sole trader arrangement I suggested isn't legal? If that's the case, then I'll go down the PAYE route and let him figure out the workings of it. Thanks again

It's not that it's not legal - it's certainly not illegal - but the fact remains that Revenue come down very hard on such arrangements whenever they have reason to believe that an employment situation is being treated as self-employment.

I know it's unfair but we are where we are.

 

[Towger]

If he already had 5 PAYE employees adding a 6th should not be an issue, except for paying Employer PRSI.

 

[Dr Strangelove]

@Luckenbach

Roughly what kind of work is it?
Is it done on or off site?
Will it be guaranteed or fluctuate from week to week?


I’m not best placed to advise on the tax treatment but all of these factors are relevant as to whether it is legitimate self employment or not.

 

[Luckenbach]

It's not that it's not legal - it's certainly not illegal - but the fact remains that Revenue come down very hard on such arrangements whenever they have reason to believe that an employment situation is being treated as self-employment.

I know it's unfair but we are where we are.

I get it now. Cheers

 

[Luckenbach]

@Luckenbach

Roughly what kind of work is it?
Is it done on or off site?
Will it be guaranteed or fluctuate from week to week?


I’m not best placed to advise on the tax treatment but all of these factors are relevant as to whether it is legitimate self employment or not.

Auditing their records mostly done from my home. Guaranteed hours.

If he already had 5 PAYE employees adding a 6th should not be an issue, except for paying Employer PRSI.

True. I need to get a certain amount off him after tax so I'll let his accountant do the maths

 

[Dr Strangelove]

Auditing their records mostly done from my home. Guaranteed hours.

Could you be in principle paid on the basis of tasks rather than hours worked?

Do you have to be online and available at precise times?

If the answer is yes and no, respectively, then you look more like a contractor than an employee to me.

 

[Luckenbach]

Could you be in principle paid on the basis of tasks rather than hours worked?

Do you have to be online and available at precise times?

If the answer is yes and no, respectively, then you look more like a contractor than an employee to me.

I could be paid by task I suppose. I would work whenever it suits me. As long as tasks are completed each month really, plus an annual audit.

I'm trying to minimise the cost of the arrangement to my friend/employer. For them to pay me what I need, they have to factor in paye, prsi etc. He would be happier if I invoiced him but I don't have a business or VAT number and the work available doesn't justify that.

Thanks

 

[T McGibney]

I could be paid by task I suppose. I would work whenever it suits me. As long as tasks are completed each month really, plus an annual audit.

I'm trying to minimise the cost of the arrangement to my friend/employer. For them to pay me what I need, they have to factor in paye, prsi etc. He would be happier if I invoiced him but I don't have a business or VAT number and the work available doesn't justify that.

Thanks

It's pretty easy to register for Income Tax.
You don't have to register for VAT until your expected annual income exceeds €40,000.
If you were to concurrently provide similar services to more than one customer, this would help you enormously in being regarded as being in business in your own right. Perhaps there is the seed of an opportunity there?
Good luck with it.

 

[Dr Strangelove]

I could be paid by task I suppose. I would work whenever it suits me. As long as tasks are completed each month really, plus an annual audit.

Then it looks like you are contracting.

The big difference is no employers’ PRSI for your friend.