Self-emplyed v employee

[olivia]

I have been employed as an employee earning €20/hour gross and have recently resigned. My employer has offered me occasional project work working mainly from home as a self-employed contractor at the same rate. Am I right in thinking they will be saving money (not paying PAYE etc) and I will be earning less? If so, how much? I think I should look for €25/hour. Any advice would be appreciated

 

[chook]

A VERY general rule is that you need to double the hourly take-home pay you would receive as an employee in the same role, though to an extent this depends on circumstances.
You need to consider
- different tax treatment (see )
- cost of home office, possibly internet, phone, heating, electricity
- cost of transport
- insurance
- provision for holidays, potential sick-days etc.

So if your take-home pay was, say, 16/hour you should aim at 32/hour in your negotiations.
To help argue your case, make a list of all that was provided for you in your job (e.g. workspace, computer, BIK, etc.) and work out the employer PRSI contribution that would have been paid for you.

HTH

 

[Importer]

Dont know where Chook is getting his "very general rule" that you need to double your pay but it certainly doesnt make any sense to me.

Your employer will no longer need to pay employers PRSI. He will no longer need to fund your annual holidays and he may save on some office accomodation, supplies etc. I dont know if he contributes to your pension

My calculations say that you would need to receive approximately 30% more to leave you in the same position as before.

 

[Leo]

My calculations say that you would need to receive approximately 30% more to leave you in the same position as before.

I'd be interested in seeing what you base those calculations on? My thinking is that would leave the OP well short of their current income levels. You'd need around 10% to cover public holidays and vacation time.

Then what about illness and any medical insurance? You won't have the same entitlements to social welfare as employees. You'll have additional overheads in book-keeping/accountancy costs. On the flip side, you'll be able to write-off expenses.

Bur all that's before you even consider the implications of the word 'occasional' there. What happens when there's no work for 2 weeks, or 2 months?
Leo