Prsi class - company director

S

Squirrelstown

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Hi I have a small business. I own 99% my wife 1%. I am a director, she is the company secretary. We both get Salaries from the company. Social welfare is saying I am prsi class S but that she should be prsi class A. We are jointly assessed for income tax. I thought the propriety director and their spouse can both be class S. Does anybody have any thoughts / experience with this?
 
It might be related to the percentage she owns of the company, 1% is very small, think you may have to own 25% or more, but could be wrong.
That's what I'd google to see, out of interest why did you split ownership 99:1, a lot of owner director companies may only issue 2 shares so by default its 50:50
 
it was a limited company with multiple directors/shareholders previously. now one director 99 + 1. trying to find where on social welfare this is specified.
 
Squirrelstown said:
trying to find where on social welfare this is specified.
Click to expand...

PRSI and Family Employment

www.gov.ie www.gov.ie

PRSI Class when employing your wife / husband / spouse | Do My Books

Employment arrangement Social welfare cover as aresult of the arrangement Your spouse or civil partner is a sole trader andemploys you None You assist your self-employedspouse or civilpartner but you are not apartner in the business You will be covered under Class S PRSI You work as an...
domybooks.ie domybooks.ie
 
From the link above

From 1 July 2013 proprietary directors who own or control 50% or more of the shareholding of a company, either directly or indirectly, are classified as self-employed and liable to pay PRSI at Class S. The classification of proprietary directors who own or control less than 50% of the shareholding of the company will continue to be determined on a case by case basis, taking into consideration the "Code of Practice for determining Employment or Self-Employment status of Individuals"

I'd say the 99%-1% is probably the cause
 
ok thanks, so

Gov.ie....Exceptions to this general rule apply in the case of certain 'Family Employment'. This term is used to describe a situation in which a self-employed sole trader/businessperson either employs, or is assisted in the running of the business, by a spouse/civil partner or by other family member(s). (Employment by a Limited Company or a business partnership is not "Family Employment" because the employment relationship is with the Limited Company or the business partnership, rather than the individual family member(s).

The classification of proprietary directors who own or control less than 50% of the shareholding of the company will continue to be determined on a case by case basis, taking into consideration the "Code of Practice for determining Employment or Self-Employment status of Individuals"

DoMyBooks...
You work as an employee for a limited company in which your spouse or civil partner is a shareholder =
You will be covered under Class A PRSI. This is because your employment relationship is with the limited company, not with your spouse or civil
partner.

You provide a service as a self-employed person to a limited company in which your spouse or civil partner is a shareholder =
You will be covered under Class S PRSI. This is because your relationship is with the limited company as a business, not with your spouse or civil
partner.
 
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