Starting from scratch

stupidusername

Can't find any straight forward information on this anywhere. I'm looking into making websites for people, with a business partner. We are currently on a project, and the company owner is applying for a grant to pay for half the cost. We're not registered as a business / partnership / company. We've sent a quotation, the grant has been approved. They're looking for us to be paid in a cheque but we don't have a business account, as we're not a registered business.

What legal obligations do we have in terms of registering, paying VAT / tax?

Do we have to / should we register our business name? Is this needed for a business account with a bank? Is this the likely way people are going to want to pay?

Don't mind registering as a partnership / business, but just need to know what everything means first.

dbran

Hi

You do not have to register for VAT unless your total income is greater then 37,500k per annum. But it may be advantageous to register as it means you dont give away the scale of your business unnecessarily when tendering for jobs.

If you are in business you must register for income tax and file a tax return every year at the end of October.

If you are trading as a partnership other than your own name you are obliged to register your business name with CRO. The bank will require a copy of the business name in order to open a business bank account in that name. People will usually want to pay the business who carried out the service.

Kind Regards

dbran

stupidusername

Thanks.

Just also... Could I register as a sole trader? What difference would that make?

As a business paying income tax, how do i register to do that? And how much would that be? Obviously a percentage of my income, but what percentage? And does that mean I'd have to keep track of business expenses?

Rogue1

Hi,

Yes you can register as a sole trader which is the easiest (just pay tax and PRSI as a self employed person), however the biggest drawback is, should your business fail, you are liable for everything!! Setting up a limited company with the CRO avoids that, but then you are required to submit accounts every year.
My best advice would be to find a good accountant through a business friend or something, and they will be able to best advise you as to how to structure your business.

stupidusername

ok, so i dont need to register for vat if i'm not going to make 37000 in a year. So don't need to register for vat. But in order to get paid i need to have a bank account in the business name. to get a bank account in a business name i need to register a business name. to register a business name i go to www.cro.ie. Do i need to use my PPS number for this? And how much will it cost?

Lorelei

cost is shown on the site. You dont need to registe if you are going to trade under your own name. You just need to inform the revenue.
If trading under your own name you just open a second account.
Either way register for VAT you submit a return every 2 months and it simple do up a spread sheet showing
Money coming in and Money going out each 3 columns. Colum 1 net colum 2 VAT paid/payable, (watch for correct rate of VAT) and total.
At end of vat period add up amount of VAT in each column this gives you total collected and total paid.
Enter in VAT returne and send off, VAT will either refund or collect.
Otherwise you dont get any refunds until end of year.
Income tax as sole trader also easy.
Keep records all business expenditure (dont worry if you enter something wrongly the revenue will question and then allow/disallow, you wont get into trouble).
At end of year enter all income subtract all business expenditure the balance less personal allowances is your taxable income. Check tax tables which bracket higher or lower do you fall into and sent in return with tax.
Any question ask the taxman they are extremely helpful in my experience.
If you need more infor pm me.

MOH

stupidusername wrote: »

ok, so i dont need to register for vat if i'm not going to make 37000 in a year. So don't need to register for vat. But in order to get paid i need to have a bank account in the business name. to get a bank account in a business name i need to register a business name. to register a business name i go to www.cro.ie. Do i need to use my PPS number for this? And how much will it cost?

REgistering a business name online will cost €20