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Setting up as Sole Trader or Limited company

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  • 12-03-2013 8:48pm
    #1
    langer123
    Users Awaiting Email Confirmation Posts: 35 ✭


    Hi All

    I currently work as a permanent software engineer.
    Due to the booming IT market at the moment I was considering moving into contracting. I'd be looking at an average rate of 350 per day. Lets just say 70k over the space of a year when holidays, weekends, etc are taken into account.

    70000/12 = 5800 per month.

    How much of this 5800 per month could I expect to take home after all taxes:
    1: As a sole trader
    2: As a limited company

    In particular, how does the take home pay compare in relation to take home pay of a permanent 70k position?

    No need to be too precise of course! :)
    Tagged:


Comments

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    #2
    srsly78
    Registered Users Posts: 7,157 ✭✭✭srsly78


    It will cost you a grand or less per year for an accountant to give proper advice and setup company etc.

    You will pay MORE tax as a self-employed person, however you can claim certain expenses depending on circumstances.


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    #3
    langer123
    Users Awaiting Email Confirmation Posts: 35 ✭langer123


    srsly78 wrote: »
    It will cost you a grand or less per year for an accountant to give proper advice and setup company etc.

    You will pay MORE tax as a self-employed person, however you can claim certain expenses depending on circumstances.

    Thanks for the reply srsly. Before committing to a contract and then paying an accountant, I'd like to get a right idea of the taxes and rates i will pay. After weighting this up, if i decide to go the contracting route i will then seek professional accountancy advice.

    Any ideas on what tax rates i will pay?


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    #4
    srsly78
    Registered Users Posts: 7,157 ✭✭✭srsly78


    You pay the same tax rates as everyone else, there are some credits that you might miss tho.

    If you want to try out contracting use an umbrella company, they will charge you loads tho.


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    #5
    dearg lady
    Closed Accounts Posts: 2,091 ✭✭✭dearg lady


    Your tax is same if your employed/self employed, PRSI is less for self employed (you get less benefits) Tax for a company is a whole different ball game. The company pays tax on profits, and you as an individual would pay tax on the money you take out. Honestly, there are so many variables, it's hard to give a definitive answer. Spend some time on the Revenue website, and speak with a professional


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