Professional services versus Sub-Contract

T

trg

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Hey All,

Anyone any idea on how to get as definitive an answer as possible on the following?

A project manager working for a company on an invoice basis i.e. not PAYE. He can and I believe does work for other companies so the RCT 1 is not a problem. The work he is doing is for an engineering company and that company falls under the remit of RCT.

He does not provide any material or labour, only his skill and experience

Is he providing a professional service or is he a sub-contractor? Bear in mind there is no contract in place for transactions.

As I understand it if he is providing a professional service then the invoices are not subject to RCT rules and are treated the same as accountants & solicitor invoices.

If he is deemed to be a sub-contractor then he comes under the RCT rules.

I understand that if he is deemed to be a sub-contractor and he eventually ceases to work elsewhere then he comes under PAYE umbrella.
 
It sounds like he is an independent consultant providing professional project manager services.
If so, he may be required to issue his invoices to the engineering company PLUS V.A.T.
His invoices are handled within the company and not interfacing other sub-contracts.
A call to the Revenue Commissioners to clarify this will cost you nothing.

This link may assist you.

ONQ.

All advice on AAM is remote from the situation and cannot be relied upon as a defence or support - in and of itself - should legal action be taken.
Competent legal and taxation professionals should be asked to advise in Real Life with rights to inspect and issue reports on the matter at hand.
 
trg said:
As I understand it if he is providing a professional service then the invoices are not subject to RCT rules and are treated the same as accountants & solicitor invoices.
Click to expand...

That is correct.

If he is deemed to be a sub-contractor then he comes under the RCT rules.

I understand that if he is deemed to be a sub-contractor and he eventually ceases to work elsewhere then he comes under PAYE umbrella.
Click to expand...

This is a different issue of contract of services and contract for services.
http://www.revenue.ie/en/tax/rct/determining-the-correct-employment-status-of-a-worker.html
 
trg said:
Anyone any ideas or am I missing something simple??
Click to expand...

Well kinda...

RCT applies to payments made by a principal contractor to a subcontractor under a relevant contract (this is a contract to carry out, or supply labour for the performance of relevant operations in the construction, forestry or meat processing industry)

Definition of construction operations here: http://www.revenue.ie/en/tax/rct/construction-operations.html

If he is merely providing management / oversight of someone else's relevant operations, he isn't providing "labour" himself subject to RCT AFAIK.
 
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