IT professionals are full of ideas, they are often in the highest tax bracket which is 49%. One of the questions we get asked the most is that:

I heard company tax rate is only 27.5%, can I use company to deal with my employer instead?

The quick answer is “no” if it is a PSI (personal service income).

It is important to first find out the criteria of being qualified as PSI, and if it is, an individual need to ensure that if any specific tax rules are applicable to the income. If the PSI is not qualified for the current condition, the business will be a Personal Services Business (PSB). Once an individual is classified as a PSB, apart from the requirement of declaring any PSI on a tax return, there are no changes to the individual tax obligations.

As for PSB determination, two ways to be classified as using Personal Service Income Tool or Completing the PSB determination application form. Unusual business circumstances occur if the following is met

• Business is temporary (< 12 Months) and out of the ordinary
• An individual passed the test in one or more previous income years
• An individual can reasonably expect to pass the test in following income year

• We can help you to build a buisness
• Yes, in IT
• Yes, with accountants and advisers
• You can …