Register as a Sole Trader
Register as a Sole Trader
Our extensive knowledge and experience make registering as a sole trader fast and cost-effective.
- Identify advantages/disadvantages of Sole Trader
- Compliance with business and tax law
- Handle necessary forms on your behalf
- Expert knowledge at competitive rates
- VAT/PAYE Registration
- RCT Registration for builders
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RUSSELL AND CO. REGISTER AS A SOLE TRADER
Starting out as a freelancer, contractor or small business owner begins with the requirement to register as a sole trader. We make this process easy and free of hassle by completing the essential steps for you. Let us help you to begin your journey as a business owner or independent professional.
As experienced accountants, we are in an excellent position to help you register as a sole trader. Our extensive knowledge and experience means that we can make the process simple, taking care of all of the necessary tasks to ensure you comply with business and tax law. Registering as a sole trader means letting the Revenue know that you should be taxed as a self-employed person. After registration, we can also provide assistance with accountancy and taxation to help you keep your finances organised.
Using professional accountants to register as a sole trader means that you can get it right the first time. The steps that you need to take to register can be time-consuming and even confusing at times. We can fill out all necessary forms for you and make sure that we provide accurate information for your registration so that you can concentrate on bringing in business.
How can Russell and Co. help?
We can also offer you advice on whether doing business as a sole trader is the right choice for you, or if forming a Limited Company is the better option. It’s important to understand both of these options and decide which one is the best choice for your business plans. After guiding you through the process to register as a sole trader, we can be there for you in other ways such as general accounting, payroll, taxes and business coaching. Getting everything right from the start will help you to start your business on a positive note, and have everything organised from the very beginning.
With our cost-effective sole trader registration service, your business will start with everything in order so that you’re ready to start trading.
Our Sole Trader Setup Service
To help you register as a sole trader, we can help you with the following:
- Register you for Income Tax
- Register for VAT
- Register for PAYE
- Register your business name
Relevant Contracts Tax (RCT) registration for builders
Sole Trader or Limited Company?
When you set up your business, one of the most significant questions that you’re likely to have is whether you should be a sole trader or set up a limited company. There are both advantages and disadvantages to both, but registering as a sole trader is often the best choice if you want to keep things simple. When first setting up a business, it can be the most sensible option, and you might consider transitioning to a Limited Company later. When you register as a sole trader, you simply need to ensure you are registered for the right taxes. You don’t have to prepare financial statements, and there are fewer legal requirements too.
However, you should note that as a sole trader, all of your profits are taxed at the income tax rate, and you are also personally liable for any debts from the business. Each year you need to prepare a tax return, which is something that your accountant can help you with. If you have a simple business model for a small business, registering as a Limited Company is often not necessary. Choosing to register as a sole trader is usually the better choice.
However, when you create a Limited Company, it makes your business a separate legal entity. This means that the company is liable for all business debts, and not you personally, and is liable for any potential legal issues too. A Limited Company can provide tax benefits to some, with corporation tax at 12.5% for company profits. A Limited Company is also more complicated to set up, requires more corporate filings and can incur large penalties for non-compliance. We will help you to decide if you should register as a sole trader or set up a Limited Company.
Income Tax Registration
To register as a sole trader for Income Tax, you can fill out a paper form or register online. TR1 is the required form for tax registration, or you can use the Revenue eRegistration option. The Revenue Online Service (ROS) allows you to register for Income Tax and other taxes online, as well as cancel or re-register using your account. Not everyone is eligible for eRegistration, including non-resident directors. If you are ineligible for online registration, residents need to fill out the TR1 form and non-residents Form TR1 (FT). These forms need to be mailed to the local Revenue office.
Self-employed people pay Class S PRSI contributions. This class of contributions entitles you to a limited range of social insurance payments, should you need to access them. The contributions are paid at a rate of 4% on all income or €500, whichever is greater. You do not have to pay Class S PRSI contributions if you earn less than €5,000 in a single tax year, but you can choose to pay a voluntary €500 to maintain your contributions. You will automatically be registered for PRSI when you register as a sole trader with Revenue.
Registering for VAT
You may be required to register for Value-added Tax (VAT) when you register as a sole trader and set up your business. This is necessary when your annual turnover exceeds the VAT threshold, which varies depending on the type of business that you conduct. There are different thresholds for those who only supply services, those making mail-order or distance sales into the country, those supplying goods, and more. VAT registration thresholds begin at an annual turnover of €35,000. You can also elect to register for VAT if you do not exceed the relevant threshold, which can make it easier for you later when you reach the threshold. You can register for VAT online using ROS or the TR1 form. VAT is an extremely complex area and we would be delighted to assist you and your business.
Registering for PAYE
If you are planning to employ anyone when you register as a sole trader, you will also need to register for Pay As You Earn (PAYE). This is necessary if you pay any employees more than €8 per week (or €36 per month) if they are full-time employees, or more than €2 per week (€9 per month) if they have other employment. This essentially means that all employers need to register for PAYE. You need to tell Revenue within 9 days from the employee’s start date. If not using the online method, you can register for PAYE using the TR1 form when you set up as self-employed. If you are already registered for Income Tax, you can use the PREM Reg form.
Registering a Business Name
When you register as a sole trader, you can trade under a business name if you want to, although it is also possible to simply use your own name for your business. If you decide that you want to name your business, you can do it online with the Companies Online Registration Environment (CORE) website to register your name with the Companies Registration Office (CRO). To register a business name using a paper form, the RBN1 form is the correct one for an individual who wants to register a name. Having to separately register your name with CRO can be an inconvenience, but our services can remove the hassle for you.
RCT Registration for Builders
Some sole traders in specific industries might need to consider some other essentials. For example, if you are working in the construction industry as a self-employed person, you might need to pay Relevant Contracts Tax. RCT applies when a subcontractor is hired by a principal contractor for construction operations under a relevant contract. This withholding tax has rates of 0%, 20% and 35%. RCT also applies in the forestry and meat-processing industries. RCT compliance, filing and payments are all carried out using ROS. Both principal contractors and subcontractors need to make sure that they are registered. When you register as a sole trader, you need to know if RCT is something that will affect you.
Registering as a sole trader is easier than setting up a Limited Company, but it still requires a number of different steps. It can be a time-consuming process, particularly if you are unsure about anything or you have any circumstances that might complicate your registration.