registered a business with cro : tax implications

davgtrek

hi all
i am on 3 day weeks as a paye employee for the time being. To make sure nobody got the .ie domain name i may want if i ever set up a business ( this may never happen if i stay with current employer or move to another employer etc. ) i registered the name with cro and its accepted etc.

however i have no intentions of trading. i am happy to be PAYE at present but will spend the next 6 months learning about websites and trying to set one up.

do i have to do tax returns for the name i registered this year ???
surely not, well hopefully not.

thanks

DoMyBooks

If you are not trading then you dont have to file accounts. Keep your invoices certain pre-trading expenses are allowable when you do start trading.

davgtrek

thanks for that advice.

drunkmonkey

DoMyBooks wrote: »

Keep your invoices certain pre-trading expenses are allowable when you do start trading.

For how long before, what kind of things can you claim for?

DoMyBooks

drunkmonkey wrote: »

For how long before, what kind of things can you claim for?

Here's the official document showing what you can claim. The period is 3 years

Introduction
Section 82 TCA 1997 provides that certain pre-trading expenses of a trade or profession are allowable in calculating the trading income of that trade or profession once it commenced. The relief applies to trades or professions, whether incorporated or not, which commence on or after 22 January 1997.
Under Section 82, a deduction is available in respect of pre-trading expenses which:
• are incurred in the three years prior to commencement of the trade or profession, and
• apart from Section 82 would not be allowable, but would have been allowable if they had been incurred after the date of commencement of the trade or profession.
Accordingly, the provisions of Section 81 TCA 1997 apply for the purposes of calculating the deduction. For example, only pre-trading expenses which were wholly and exclusively laid out or expended for the purposes of the trade or profession are allowable.
No relief is allowable under any other provision in respect of a payment which qualifies for relief under Section 82.
Expenses
Examples of pre-trading expenses are:
• Accountancy fees
• Advertising costs
• Costs of feasibility studies
• Costs of preparing business plans
• Rent paid for the premises from which the trade or profession operates.

thecleverone

do i have to do tax returns for the name i registered this year ???

Business Names (sole traders) that have registered with CRO do not have any ongoing filing obligations with the Companies Office apart from change of address, cessation of business name etc.

Tax Returns are obviously dealt with by the Office of the Revenue Commissioners. You do not have to file any tax returns unless you've actually traded the business and/or have notified Revenue by way of aTR1 form (registration for tax for a sole trader) that you've begun trading.

howiya

Rather than start a new thread I also have a business name that i want to register as a limited company in order to acquire the associated domain name with no intention to trade until mid 2011/early 2012 depending on circumstances.

Obviously a minimum of two directors are required. I intend to keep it in the family and my brother has agreed to be listed as director.

Couple of questions

1) My brother is temporarily unemployed. Will listing him as a director affect his current social welfare entitlements?

2) Am i better of registering the business name ie sole trader rather than forming a limited company?

DoMyBooks

howiya wrote: »

Rather than start a new thread I also have a business name that i want to register as a limited company in order to acquire the associated domain name with no intention to trade until mid 2011/early 2012 depending on circumstances.

Obviously a minimum of two directors are required. I intend to keep it in the family and my brother has agreed to be listed as director.

Couple of questions

1) My brother is temporarily unemployed. Will listing him as a director affect his current social welfare entitlements?

2) Am i better of registering the business name ie sole trader rather than forming a limited company?

Limited companies come with a lot of compliance costs. Its generally better to start off as a sole trader and review after a year or two of trading.

thecleverone

Obviously a minimum of two directors are required.

Only for a limited company. If you register a business name as a sole trader then one will suffice i.e. you.

Limited companies come with a lot of compliance costs. Its generally better to start off as a sole trader and review after a year or two of trading.

DoMyBooks is spot on (unless it's a new business, registered and trading in 2009/2010 that could avail of the new business start-up tax exemption).

howiya

Thanks for the responses. Think I'll go with the business name as it is sufficient enough for the purposes of registering the domain name and sounds a lot less cumbersome

DoMyBooks

Keep your records and receipts to claim pre trading expenses too?