Setting up a company/union for sole traders

experiMental

I don't know the mechanics of taxation system, so feel free to correct me or declare that I'm mad. I wouldn't mind that

Why isn't anybody setting up a company, where each sole trader can sign up to it? So I envision it working like this :

There is a company, and if you are a sole trader, you sign up to it as a PRSI employee. If you want to purchase inventory and process your receipts, you do that through that company. It has a centralised system that processes them all, and keeps records for you. Your can still do the business with customers using your name, and the name of your service will just be a brand that will belong to a company.

The upshots : if the company will own enough stock and assets to float itself on the stock market, it can give sole traders stock options as bonuses. Each sole trader will have the same social benefits as an employee.

The downside : It will be a lot more difficult to compete with other sole traders who are providing the same service as you are. I suppose this pitfall will completely destroy the idea itself. However, what is better : having good social benefits or having a competitive advantage?

Is this possible? Is it a good idea at all? I'm just wondering

Nody

It's called umbrella companies and you're greatly underestimating the legal thorn bush of the set up from the fact the company has to invoice and pay taxes, the audits, the split of costs and overheads etc.

Scofflaw

Some kind of association might work. To be honest, as someone long-term self-employed I rather struggle to see the advantage in the points you propose. You're basically suggesting the self-employed band together in order to become employees.

cordially,
Scofflaw

experiMental

Scofflaw wrote: »

You're basically suggesting the self-employed band together in order to become employees.

cordially,
Scofflaw

Yes, but they won't have a manager that directs their work. However, they have better social benefits.

you're greatly underestimating the legal thorn bush of the set up

It can be difficult to sort the legal problems out, but complex things like these are business opportunities in their own right. It puts the legal system to a test

Godge

experiMental wrote: »

Yes, but they won't have a manager that directs their work. However, they have better social benefits.



It can be difficult to sort the legal problems out, but complex things like these are business opportunities in their own right. It puts the legal system to a test

Better social benefits but less beneficial taxation benefits.

Labarbapostiza

Scofflaw wrote: »

Some kind of association might work. To be honest, as someone long-term self-employed I rather struggle to see the advantage in the points you propose. You're basically suggesting the self-employed band together in order to become employees.

cordially,
Scofflaw

No, the form he's talking about is a co-op. It depends on what the sole trader does. Whether an organisation would have the economies of scale to benefit them.

In many typical employment situations socialability trumps productivity. In a co-op stakeholders are allowed to ask why the fat bum in human resources on seventy grand a year, uses recruitment agencies when they could advertise for free elsewhere.

Scofflaw

Labarbapostiza wrote: »

No, the form he's talking about is a co-op. It depends on what the sole trader does. Whether an organisation would have the economies of scale to benefit them.

In many typical employment situations socialability trumps productivity. In a co-op stakeholders are allowed to ask why the fat bum in human resources on seventy grand a year, uses recruitment agencies when they could advertise for free elsewhere.

Sure - I know the form, but it still involves becoming an employee, even if it's a self-directed shareholder-employee.

It doesn't necessarily make sense for the self-employed to undergo a major change in their tax arrangements (and there are a lot of ramifications) in order to perhaps benefit from the scale advantages on services which can probably be hired as needed from specialist companies who already benefit, probably more, from scale advantages.

cordially,
Scofflaw

experiMental

Thank you so much for your feedback, but one question remains :

Can you name some examples of legitimate co-ops and umbrella companies that could be useful for a sole trader?

Thanks a million