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Sole Trader-a salary?

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  • 13-12-2006 5:28pm
    #1
    Jules402
    Closed Accounts Posts: 2 ✭


    I am looking into setting up a business as a sole trader. However I would like to work as the manager and pay myself a wage instead of hiring someone else. The whole point of setting up a business is so that I am self-employed and work for myself-is that what a sole trader is?

    Can I set myself an hourly wage and pay myself like this? I know with a sole trader, 'wages' are taken out as drawings but would it be okay to give myself the manager title and an hourly rate, almost like an employee?

    How would my drawings/wages be taxed because business profits are my taxable income?

    Any help appreciated! Thanks!

    Julie


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    #2
    EKRIUQ
    Registered Users Posts: 4,386 ✭✭✭EKRIUQ


    As a sole trader your profits are your income if you take €500 per week for your wages as far as I know (stand to be corrected) normal p.a.y.e. rates apply until you get to the threshold. But you have to look after your own PRSI.

    Income is income and tax rates apply if your profits go above the lower bracket 20% then your profits are taxed at 42%

    Hope that helps


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