Company structure - Irish branch of uk company

nino1

Would be very grateful for some advice around a company structure

My partner and I have a UK registered business, started 2 years ago as as sales were mainly from the UK

We registered an irish company for the Irish sales in October 2022 and opened a bank account and began making sales in January 2023. 

The bit that is a bit complicated now is that rather than buying in loads of stock when sales were low at the start, the UK company just sent me over any stock that I needed whenever I made a sale in a kind of informal way. This is the way it’s been done from January 2023 until now.

Next week I will start ordering directly from the suppliers myself for the Irish company so it will be much cleaner. 

im looking for some advice on how best to structure the company?

ie is it possible to make the Irish company a subsidiary of the UK company? 

And what would be the best way to account for “cost of sales” for the 6 month annual return (I know I’m late with this!) when the items were being sent over from the UK company? 

Mick Tator

The answer depends on several things that you do not mention.

You should not be doing anything like “a sale in a kind of informal way “ – you have a fiduciary duty to both entities and should have a proper invoicing structure in place. Much depends on which is the bigger (or potentially bigger) entity, the directions the businesses are going, the shareholding structure of both entities, etc. Legally you could maintain the status quo, or one company acquires the other and make it a  subsidiary (then no need to file separate accounts), or you might consider closing one company and then creating a branch. All of these have tax implications. You should already have a shareholders’ agreementin place  (if not, prepare one now).

You really need an account’s advice.