bike to work - do i get extra relief as a contractor?

cojomo2

Sorry if this has been covered....

I'm a contractor under an umbrella company as a PAYE worker, so as well as paying all the usual taxes , I also have to pay employers PRSI.

Does that mean instead of getting a 52% discount, it will be more like a 60% discount ?

Thanks

bazermc

cojomo2 wrote: »

Sorry if this has been covered....

I'm a contractor under an umbrella company as a PAYE worker, so as well as paying all the usual taxes , I also have to pay employers PRSI.

Does that mean instead of getting a 52% discount, it will be more like a 60% discount ?

Thanks

No. The company has the liability to employers PRSI not you personally.

Qualitymark

bazermc wrote: »

No. The company has the liability to employers PRSI not you personally.

But if s/he is the company? Do companies get part of the bike-to-work relief?

cojomo2

bazermc wrote: »

No. The company has the liability to employers PRSI not you personally.

I pay the employers PRSI myself..as strictly speaking, I am the company.

bazermc

cojomo2 wrote: »

I pay the employers PRSI myself..as strictly speaking, I am the company.

You may own the company but in a strict legal sense they are different entities. Hence the reason why you operate through a company in the first place.

bazermc

Qualitymark wrote: »

But if s/he is the company? Do companies get part of the bike-to-work relief?

No relief only applies to employees PRSI and income tax.

chickenlicken2

Yes it will work the same as any other expense. Deduction from your invoice value and remaining balance is then between gross & er prsi.
Make sure you get it in company name.

cojomo2

bazermc wrote: »

You may own the company but in a strict legal sense they are different entities. Hence the reason why you operate through a company in the first place.

The point I'm making is that employers PRSI comes out of my pocket , from money I have earned ..so, if I buy a bike for 1k, this will be taken out of my gross monthly wage, and so surely I won't be paying employers PRSI on on that 1 k ,that I otherwise would ?

chickenlicken2

Assuming a monthly invoice value of €4,500 and a bike for 1000 paid in one month. Ignoring other expenses and management fees.

Invoice value less expenses 3500
Gross pay 3,160.27
Er Prsi 339.73

If no bike
Gross pay 4063.20
Er prsi 436.79

Btw of you are paying management fees to a company offering the payroll service or umbrella company service your fees should include answers for questions such as these.

bazermc

cojomo2 wrote: »

The point I'm making is that employers PRSI comes out of my pocket , from money I have earned ..so, if I buy a bike for 1k, this will be taken out of my gross monthly wage, and so surely I won't be paying employers PRSI on on that 1 k ,that I otherwise would ?

Ah i get you,

From; http://www.revenue.ie/en/tax/it/leaflets/benefit-in-kind/faqs/cycle-work.html#cycle4

What are the benefits of the scheme for employers?
The employer benefits in that the employer’s PRSI is not payable on the cost of the bicycle and/or safety equipment.

Beasty

cojomo2 wrote: »

Sorry if this has been covered....

We have a megathread

It's linked in the FAQs