sole trader

afatbollix

hello folks

im setting up a hire out of equipment business at the moment and i want to be up and fully running by January.

at the moment i work in a company and that will be my full time job and this other company will be at weekends only..
i have a few questions i hope some one can answer them.

How do i register to become a sole trader?

Ill be buying the equipment from the UK, i heard that i dont need to pay VAT. do i need a irish VAT number to not pay up front like in ireland and them claim it back? If i do how do i get one?

Ill be paying tax on my full time job will i need to pay prsi and income tax on what the company will earn?

i have my personal bank account should i get a bank account for the business?

Any help would be great..

cheers
anthony

BenjAii

Hi Anto, i may not 100% right on everything here, but AFAIK ......

You don't have to register to be a sole trader, just go ahead and do it ....

You do have to register to get a VAT number, if you want to claim back VAT. That means you will have to charge VAT too.

Company earnings, will be taxed PRSI'd as additional to what you earn in your job.

Yes to a biz bank a/c.

It would be worth your while seeing an accountant as well to sort out the arrangements, they will be able to tell you what expenses you can offset to tax which will save you the cost of seeing them.

Axwell

BenjAii wrote: »

You don't have to register to be a sole trader, just go ahead and do it ....

Wouldnt be so sure thats right, you would find it hard to get a business account and register for Vat without some form of business registration details.

Go to www.cro.ie and you can register as a sole trader there to get your RBN (Registered Business Name). Then go to your bank and get the forms for setting up a business account. You can register for Vat at the revenue website, www.revenue.ie online or via normal paper format, the forms are on the site for printing off. I think your understanding of Vat and how it works is a bit misguided too so id suggest having a read of the material on the revnue website regarding same.

JoeTurner

anto-t wrote: »

How do i register to become a sole trader?

Form TR1 will do the job for tax purposes for a sole trader - available at http://www.revenue.ie/forms/formtr1.pdf

anto-t wrote: »

i have my personal bank account should i get a bank account for the business?

Always helps to separate the business account from the personal one - if you ever get a Revenue audit and you have a seaprate bank account you won't have to explain personal transactions

anto-t wrote: »

Ill be paying tax on my full time job will i need to pay prsi and income tax on what the company will earn??

Yes, as a sole trader you'll be taxed at your marginal rate i.e. 20 or 41% - if you're on the 41% tax bracket on your paye job all the sole trader earnings will be taxed at 41% and pay prsi at class s (once you earn over a certain limit) - just to clarify, are you going with a sole trader or limited company set up as you mention a company here...

Good luck with it all - pm me if you need anything more

Joe

Tav

Hi,

I have a similar question - I want to keep my day job but also set up a limited company - how this will affect my taxes etc.?

tav

Mr Clonfadda

Hi Tav.
A limited company differs from a Sole Trader, A Sole Trader will pay Income tax based on his profits. If you form a Limited company you will have to pay tax and prsi on any wages you pay yourself and the company will pay corporation tax on its profits. So you can decide to transfer some of your existing tax credits and cut-off into new venture from existing employer or you can pay full tax on all you earn in new venture

Mr Clonfadda

Hi anto-t

You only need a registered business name if you are not trading in your own name.

Cheers

BenjAii

Do you not have a requirement to pay PRSI also if you have a sole trader, or is that optional ?

Nigel Sage wrote: »

Hi Tav.
A limited company differs from a Sole Trader, A Sole Trader will pay Income tax based on his profits. If you form a Limited company you will have to pay tax and prsi on any wages you pay yourself and the company will pay corporation tax on its profits.

Mr Clonfadda

BenjAii wrote: »

Do you not have a requirement to pay PRSI also if you have a sole trader, or is that optional ?

There is nothing optional about PRSI unfortunately but there is no employers charge when you are self employed, either sole trader or company

Tav

Nigel Sage wrote: »

Hi Tav.
A limited company differs from a Sole Trader, A Sole Trader will pay Income tax based on his profits. If you form a Limited company you will have to pay tax and prsi on any wages you pay yourself and the company will pay corporation tax on its profits. So you can decide to transfer some of your existing tax credits and cut-off into new venture from existing employer or you can pay full tax on all you earn in new venture

Hi Nigel.
So if I understand correctly: It's like I had two jobs (and pay tax & prsi on both incomes)?

Mr Clonfadda

Hi Tav

yes. Revenue will split you tax credits and cut off to each "job" as required.

Cheers