Tuesday 17 September 2019

Your Questions: Do I have to pay tax on income from my weekly busking gigs?


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Charlie Weston

Charlie Weston

Question: I am a musician and play regular gigs in a few bars. I also busk several days a week, making about €150 on a good week. Do I have to pay tax on my busking income? I already pay tax through my pub gigs.

Answer: Income you generate from street performance of any kind, be it your sole income or something you do on the side of your PAYE job, is considered income by Revenue and is subject to tax, according to the commercial director of Taxback.com Eileen Devereux.

There are a few different avenues for paying income from busking, depending on your status as a taxpayer i.e. whether you are registered as self-employed, or hold a part or full time PAYE position. In general, PAYE workers earning under €5,000 a year from busking can file any 'sideline' busking income under their PAYE taxes by submitting a form 12, Ms Devereux added.

It seems from the information you have provided that you most likely earn over this amount so you must register as a sole trader and file a Form 11. Your busking income will be subject to income tax, USC and PRSI. You should note that, as a self-employed worker, certain expenses incurred for business purposes can be used to reduce your taxable income by the amount of these expenses.

Question: My partner and I are currently bidding on two properties, one of which we are hoping will be our first home. We prefer one of the houses, but we want to keep our options open in case it falls through. The estate agents mentioned something about a booking deposit if or when our offer is accepted. I am not entirely sure what this is. If we pay it does that effectively mean we must take our hat out of the ring for the other property?

Answer: A booking deposit is standard in any house purchase and is usually in the region of €5,000 to €10,000, but can vary depending of the price of the property.

These deposits can be paid by cheque, bank draft or electronic transfer and are usually payable to the estate agent or the seller's/developer's solicitors, to be held as stakeholder on behalf of the vendor, according to director at Savills Catherine McAuliffe.

It demonstrates your keen interest in the property, but it is fully refundable until you sign a contact. So, in practice, you can pay this now and remain as a bidder on the second property. It is only when you move to the payment of the 'contract deposit' that your money becomes more committed.

This is a step further and is payable on signing of unconditional contracts by you, the buyer. The contract is then signed by the seller at which time the contact is exchanged. The contact deposit normally amounts to 10pc of the sale price of the property less the initial deposit. Ms McAuliffe advises that before any contracts are drawn up you should make a decision on whether or not you are sure of your decision to buy the property. The further you go down the line in the purchase process, the more complicated it will be to remove yourself and it could end up costing you. You will also incur legal costs once you engage a solicitor to act on your behalf.

Question: I changed my health insurance cover recently and upgraded to a 'private-room' plan in private hospitals. As I now may need to have routine surgery on an existing medical problem, can you explain exactly how this upgrade rule may impact on my cover?

Answer: You are right to check this as many members get caught out by this rule and end up with unnecessary shortfalls. If a change of plan gives you better overall cover, all insurers are entitled to restrict your benefit to that payable under your previous plan for a further two years for any medical problems that were present prior to the change in cover.

Assuming that you were previously covered for semi-private accommodation (up to five beds in the ward), this will still be covered by the insurer, according to Dermot Goode of TotalHealthCover.ie. But they won't pay the additional cost of the private ward as your condition was present prior to you upgrading to the new plan.

For any new conditions that present after the new cover has commenced, then the benefits under the new plan will apply, assuming that all other waiting periods have been fully served. The best advice is to check all treatment, procedures, scans etc. directly with your insurer in advance to make sure that you are always fully covered.

In summary, this reader will still be covered for semi-private accommodation for the existing medical problem with the private room cover applying to all other new conditions.

Your busking income will be subject to income tax, USC and PRSI. As a self-employed worker, certain expenses incurred can be used to reduce your taxable income.

A booking deposit is standard in any house purchase and is usually in the region of €5,000 to €10,000, but can vary depending of the price of the property.

Irish Independent

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