How to maximise your net pay when contracting in Ireland
Once you agree your day rate with your company or agency the next step will be to decide the best structure to allow you to maximise your net pay. It is great to have secured your role but there isn’t much point in working hard in a contracting role if you don’t maximise your returns. As a contractor that really is the name of the game!
The first thing to consider is the accounting structure you use. You have 2 compliant choices – a PAYE Umbrella https://www.accounting-pro.ie/umbrella-company-guide/ or a Personal Limited company https://www.accounting-pro.ie/what-is-a-personal-limited-company/ DO NOT consider a Director Umbrella company – https://www.accounting-pro.ie/why-we-dont-offer-director-umbrellas/
When should you use a PAYE Umbrella company? If you:
Do not want to contract long term (less than a year)
Earn less than €300 per day
Do not want the hassle of setting up a LTD company
Do not want the hassle of having a LTD company
Have an existing PRSA in place
When should you use a Personal Limited company? If you:
If you want to contract long term (at least a year and preferably a few years)
Earn approximately €350 or more per day
Want to have your own LTD (which can be beneficial if you have a lot of expenses to write off)
If you want to employ and executive pension and reduce your tax bill significantly using it
Then the next step is to employ all the compliant means to reduce your tax bill which includes regular business expenses, relocation expenses (if applicable), business costs and pensions. Why not contact us to learn how to manage all of this and ensure you are getting the most from your contracting experience?
Accounting Pro is Ireland’s premier contractor accounting service. We are here to help, the busy contractor and company, with all your accounting and payroll needs. We are both an umbrella company and umbrella corporation and we can create your limited company. We are experts in contractor pensions, contractor health insurance, illness and sick benefit for the self employed and contractor expenses. To learn more about what we do please review https://www.accounting-pro.ie/ and contact us by email: firstname.lastname@example.org or phone us 01 592 1199. For the UK see Accounting-Pro UK. “How to maximise your net pay when contracting in Ireland” is an article written by Accounting-Pro Ireland for the benefit of everyone. Feel free to share it but please give attribution on a CC BY-SA license.