Taxation for self employed person but jointly assessed?

[DaveD]

Not sure if this query belongs in personal or business taxation so mods feel free to move if necessary.

A married couple currently jointly assessed with husband a PAYE worker earning around €56k and wife earning €10k providing childminding services at home. Wife avails of the €15k allowance on childminding services so no tax is payable on the €10k.

Wife intends to work on a self employed basis as an artist producing portraits. If her income is say €10k per year what tax liability is there? I understand the childminders allowance is not transferable to any other income but is the entire €10k income liable for higher rate tax or do other rates apply?

As an aside and to prevent too many silly questions is there a good source of information relevant to my query that I can refer too?

There won't be too many transactions involved, VAT shouldn't be an issue and there are minimal expenses to offset, so is an accountant needed or is it relatively straightforward to file returns?

Can she avail of the tax exemption for artists on income such as this?

Many thanks for any advice offered!!

 

[tkane]

I dont believe this income would qualify for artists exemption. A painting will qualify if it is of cultural or artistic merit and should be of a quality that it would be of interest in its own right or part of an exhibition. More detail on this is included at http://www.revenue.ie/en/tax/it/reliefs/artists-exemption.html#section8. As you will see qualifying for this exemption can be based on somewhat subjective elements.

 

[tkane]

However, she would only pay tax on the portrait painting income at 20% as your standard rate cut off point is increased by up to €27,400 for income earned by the second spouse in a two income married couple.

 

[DaveD]

Cheers tkane, I've since talked to the Revenue section dealing with the artists exemption scheme and they seem quite optimistic that she'll quality and it seems quite easy to apply so no harm in applying.