Who will be most disappointed with Budget 2018? The self-employed and residential landlords

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Duke of Marmalade said:
McG this is not of course a morality tale. The PAYE worker, given the chance to get a few bob under the table, would be just as inclined as his s/e sister to avail of it but the reality is that the scope to do so is much more limited.
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Until they hire a tradesman to do a small (or big) job and then ask "how much would it be without the VAT?"...
 
Duke of Marmalade said:
I’m sure this debate has raged elsewhere on AAM but I don’t think the injustice is as stark as it appears. A s/e earning over 100k always has the option to incorporate, but then wouldn’t employer’s PRSI kick in?
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Employers PRSI doesn't exist for most company owner-directors.
 
T McGibney said:
Until they hire a tradesman to do a small (or big) job and then ask "how much would it be without the VAT?"...
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There you go, slipping into a debate about who is the most upright citizen, Mr PAYE or Ms S/E? I'm sure, for example, that they are equally guilty of speeding offences. But the point is that Mr PAYE has very little scope for avoiding tax on his PAYE income per se. Of course if he has other sources of income he will be just as inclined as the fully s/e to under declare it.
 
T McGibney said:
No I didn't, I merely rebutted your statement that for a PAYE person,"the scope to (dodge tax) is much more limited". VAT is the most evaded of all taxes.
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OMG how Jesuitical is this? If I say bus drivers are less likely to break the speed limit you would rebut me by saying bus drivers also drive cars.

We are discussing the taxability of PAYE income vs s/e income not the law abiding attributes of respective individuals.
 
Sarenco said:
That's not correct - some professionals are prohibited by statute from incorporating their practices.

Personally I don't think we should frame our tax code by reference to lazy stereotypes or assumptions.
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Oh no! I hope you are not going to go all Jesuitical as well.

I am drawing attention to the apparent contradiction that if the surcharge is such a travesty why do (most) s/e folk not avail of the opportunity to incorporate?
 
You keep claiming that its much easier for self-employed people to dodge tax. I've rebutted that, and cited VAT evasion "cash job" domestic works as an example. It's much easier for a PAYE person to engage in such evasion than their self-employed counterpart because their chances of having their personal finances subjected to Revenue Audit is infinitesimally smaller.
 
Well that’s a subtler point. Look I am not on a s/e bashing exercise here, I myself have both PAYE and non PAYE income. But I agree that on the face of it the 3% surcharge seems almost an outrage. But is it as stark as it appears?
 
Duke of Marmalade said:
But I agree that on the face of it the 3% surcharge seems almost an outrage. But is it as stark as it appears?
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It's more of a symbolic insult than an outrage. Nobody is going hungry as a result of it. But as a gratuitous and politically-motivated measure it grates nonetheless, even to those of us whom it doesn't affect.
 
Duke of Marmalade said:
I am drawing attention to the apparent contradiction that if the surcharge is such a travesty why do (most) s/e folk not avail of the opportunity to incorporate?
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According to the Tax Institute, a grand total of 22,600 income earners (~1% of all income earners) are subject to the 3% USC surcharge.

I think it's safe to assume that a significant portion (if not the overwhelming majority) of those income earners are members of professions that are prohibited by statute from incorporating their practices.

So, no, I don't think I was being pedantic in correcting your original comment that it is always open to the self-employed to incorporate.
 
Here's the relevant Tax Institute briefing (factsheet 3) -
[broken link removed]
 
These stats are in complete contradiction. Hardly explained by different time frames given the stability over time of the Revenue figures. I would tend to believe the Revenue figures but possibly the slightly different definitions explain the anomaly.
 
The Tax Institute’s figures are copied from this paper prepared by the Tax Strategy Group and issued on July 25, 2017. See table on page 6.

However, see notes 1. and 2. to that table on page 7

“1. Distributions for 2017 are estimates from the Revenue tax-forecasting model using actual data for the year 2014, adjusted as necessary for income and employment trends in the interim.

2. Figures are provisional and likely to be revised.”
 
I wonder are Revenue treating couples that are jointly assessed as a single "income earner"?

Anyway, I'm more than happy to go with the Revenue figures - not least because it helps with my point that a relatively tiny number of taxpayers actually bear this surcharge (which raises a paltry sum in the scheme of things) and a significant number (if not the majority) of that cohort are caught because they are prohibited from incorporating their businesses.

That seems gratuitously unfair to me.
 

That's not a very valid rebuttal. Firstly, by definition, anyone with a self employed income source greater than 5k is as self employed as any other self employed person anyway.

The fully self employed person has much greater scope i.e. opportunity to evade tax, as none of their income is subject to tax unless / until they file a tax return (or Revenue come and find them).

The person whose primary source of income is from employment has much less scope, proportionately, to evade tax, as the majority of all their taxes due are deducted at source. The scope for such people to have a nixer trade on the side at a level that should see them registered for VAT is very limited, and likewise the scale of evasion they can indulge in is limited by the time available to them to engage in their nixers.

Scope to do a thing, and likelihood of getting caught for having done it are two very different things.
 
Maybe I'm misinterpreting these posts but are people really arguing that it is acceptable and appropriate to impose a surcharge on a tiny minority of taxpayers because the cohort of which they form part have a greater opportunity to evade taxes? Really?!

Bear in mind that we are talking about taxpayers with a declared, self-assessed, income of more than €100k - we are not talking about the odd nixer.
 
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