Part-time work/ self-employed with Job Seekers

Lee1981

Hi everyone,
I am starting a small new business and I need to take on a driver for a couple of hours a week. This would be the only person working in the company besides me. I am trying to decide whether to take someone on as an employee or as a self-employed driver. My question is:
Is it expensive and long-winded to take them on as an employee with PAYE, PRSI forms etc?
What do I need them to sign if it is on a self-employed basis?
Will it make a big difference for them if they are already getting Job Seekers?
I know for employees if I was paying them say €50 then they disregard €20 and 60% of the difference is means, is this right?
How will it work though if I take them on as a self-employed basis? Would they lose more?

Any help would be much appreciated

Lugh Ildanach

The disregards don't apply to income from self-employment, so it is much better for the individual from a social welfare point of view to be an employee. They should seek their own information as to how to keep as much of their social welfare payments as possible. There are a number of schemes, such as the Part-time Job Incentive Scheme, which may be beneficial for them. They can also keep the child portion of any Jobseekers payments for 13 weeks after starting work in certain circumstances, even if they lose their own payment. If they are working more than 19 hours, FIS may also apply if they have children. They will need to check this out, taking into account their own circumstances, including the circumstances of any partner or spouse they may have.

It is not expensive to take someone on as an employee, especially if the wages aren't big. From a PRSI point of view, if the employee's wages are under 352/week the employer contribution is only 4.25% of their wages. It jumps to 10.75% if the wages are above this. You would have to register as an employer and file regular returns, this can be a hassle if you're not good at this kind of thing. Hiring a payroll bookkeeper for only one employee would not be expensive.

There are certain tax and prsi incentives for both you and the employee if you could give the person 30 hours or more, but it doesn't sound like you're at that stage yet.

Lee1981

Lugh Ildanach wrote: »

The disregards don't apply to income from self-employment, so it is much better for the individual from a social welfare point of view to be an employee. They should seek their own information as to how to keep as much of their social welfare payments as possible. There are a number of schemes, such as the Part-time Job Incentive Scheme, which may be beneficial for them. They can also keep the child portion of any Jobseekers payments for 13 weeks after starting work in certain circumstances, even if they lose their own payment. If they are working more than 19 hours, FIS may also apply if they have children. They will need to check this out, taking into account their own circumstances, including the circumstances of any partner or spouse they may have.

It is not expensive to take someone on as an employee, especially if the wages aren't big. From a PRSI point of view, if the employee's wages are under 352/week the employer contribution is only 4.25% of their wages. It jumps to 10.75% if the wages are above this. You would have to register as an employer and file regular returns, this can be a hassle if you're not good at this kind of thing. Hiring a payroll bookkeeper for only one employee would not be expensive.

There are certain tax and prsi incentives for both you and the employee if you could give the person 30 hours or more, but it doesn't sound like you're at that stage yet.

Thanks a million, that gives me some idea I think I will go the employee route and contact revenue to get the right forms