Advertisement
If you have a new account but are having problems posting or verifying your account, please email us on hello@boards.ie for help. Thanks :)
Hello all! Please ensure that you are posting a new thread or question in the appropriate forum. The Feedback forum is overwhelmed with questions that are having to be moved elsewhere. If you need help to verify your account contact hello@boards.ie
Hi there,
There is an issue with role permissions that is being worked on at the moment.
If you are having trouble with access or permissions on regional forums please post here to get access: https://www.boards.ie/discussion/2058365403/you-do-not-have-permission-for-that#latest

Sole trader or limited company

  • 23-01-2014 11:49pm
    #1
    Registered Users, Registered Users 2 Posts: 18


    Any advice as to when a business should go from sole trader to a limited company. I run a small web based taxi business that is doing well and growing. Have been to see two accountants that gave me completely different advice to each other and that's left me even more confused. Any ideas very welcome.


Comments

  • Registered Users, Registered Users 2 Posts: 92 ✭✭whatsthetime


    I would say that when or if you employ someone then a limited company is a must.


  • Banned (with Prison Access) Posts: 1,288 ✭✭✭sawdoubters


    if its not broken don't fix it

    also look at other opportunities like delivering packages,


  • Registered Users, Registered Users 2 Posts: 18 davynorthside


    I use around ten other taxi drivers who are not directly employed by me but would be paid for Taxi transfers that they do for me. Each driver might get approximately €100 each week depending on how much work comes in.


  • Registered Users, Registered Users 2 Posts: 92 ✭✭whatsthetime


    I use around ten other taxi drivers who are not directly employed by me but would be paid for Taxi transfers that they do for me. Each driver might get approximately €100 each week depending on how much work comes in.

    Well those are not employees so you have no employment contract with them. Is there any way that they could do something that would make you liable for a large amount of money?


  • Registered Users, Registered Users 2 Posts: 18 davynorthside


    Taxi transfers that I pass on to other drivers becomes their taxable income, I assume. So if a company pays me €20 euro for a transfer that, for example, "John" completes. I give John €18 and retain €2. I keep a small percentage to cover advertising, website etc. My tax return therefore includes all the transfers I completed myself plus the percentage I took from the transfers that I passed on to the other drivers. I keep a full record of all payments received. All payments made to other Drivers and all necessary driver ID records. Is this correct?


  • Advertisement
  • Registered Users, Registered Users 2 Posts: 92 ✭✭whatsthetime


    Taxi transfers that I pass on to other drivers becomes their taxable income, I assume. So if a company pays me €20 euro for a transfer that, for example, "John" completes. I give John €18 and retain €2. I keep a small percentage to cover advertising, website etc. My tax return therefore includes all the transfers I completed myself plus the percentage I took from the transfers that I passed on to the other drivers. I keep a full record of all payments received. All payments made to other Drivers and all necessary driver ID records. Is this correct?

    Yes that seems correct.

    Are you registered for VAT?


  • Registered Users, Registered Users 2 Posts: 18 davynorthside


    Not registered for vat as there is no vat charged on taxi services.


  • Registered Users, Registered Users 2 Posts: 260 ✭✭Immy


    If growing and you think will continue, then incorpotate IMO.


  • Registered Users, Registered Users 2 Posts: 92 ✭✭whatsthetime


    Immy wrote: »
    If growing and you think will continue, then incorpotate IMO.

    What would be the advantage?


  • Registered Users, Registered Users 2 Posts: 4,735 ✭✭✭lakill Farm


    ok as I see it.

    main reasons to set up ltd company

    you earn more than you need to live the life you want. all surplus is taxed at over an additional 40%

    you want limited liability

    you want to sell the business as a going concern in the future

    when I advise my clients I look at the full picture. so very hard to tell you what to do on minimum info


  • Advertisement
  • Registered Users, Registered Users 2 Posts: 260 ✭✭Immy


    What would be the advantage?

    So that you can draw a salary and be taxed on that rather than the profits of the business.

    Also limited liability, may not be a huge factor in this case, but you never know.

    Of course we need more info on profit levels and salary levels and future investment and the likes to make a proper argument.


  • Registered Users, Registered Users 2 Posts: 1,678 ✭✭✭nompere


    There was a piece in last Monday's Irish Times about things not to do when starting up a business - and one of them was not to incorporate too soon.

    Here's a link: http://www.irishtimes.com/business/starting-out-on-your-own-nine-things-not-to-do-1.1659205?page=3

    It fits what I've always told clients.


Advertisement