What is a Sole Trader?

The simplest and easiest way to set up in business is to commence as a sole trader. A sole trader (or sole proprietor) business is one which is fully owned by one individual. Although the owner can employ other staff, the owner retains full responsibility and ownership for the business.

Unlike a partnership or company a sole trader takes all decisions in connection with the running and management of their business without having to consult with anyone - apart from their professional advisors.

It is relatively simple to set up as a sole trader, your main legal obligation is that you must register as a self-employed person with the Revenue Commissioners. If you wish to use a business name you must register your business name with the Companies Registration Office.

Advantages of a Sole Trader:

• Sole trader businesses are usually easy to set up as there are fewer legal formalities compared to other structures.
• Decisions are made by the owner.
• All profits are kept by the owner
• Expenses which are incurred "wholly and exclusively" in the course of the trader are allowable deductions.
• The sole trader is not required to file accounts which would be available for inspection by the public.

What are my obligations as a Sole Trader?

1. 1Complete an annual tax return.
2. 2If you wish to use a business name you need to register the business name with the Companies Registration Office.
3. 3Register with for VAT if my annual sales are over €37,500 for services and €75,000 for goods.
4. 4If you take on employees you will need to register with Revenue for PAYE/PRSI and operate a payroll.
5. 5Maintain proper accounting records such as sales invoices, purchase invoices, bank documentation, cheque stubs, receipts etc.
6. 6If operating in the construction sector you need to register as a principal contractor or if you are a subcontractor you may apply for a C2 which will allow you to receive payments from a contractor without have RCT tax deductions?
7. 7While not a legal requirement, it is generally advisable to have insurance cover for various situations.

Each business is different so when you're setting up a new business you should ensure you get good professional advice.

Where can I get assistance?

I hour Free consultation with Solve Business Solutions. Call us on 01 5445 375 to set this up.

We can assist you with the following:

• Business Name Registration
• Registering for Tax
• Bookkeeping / Sole Trader Accounts
• Annual income tax returns
• Revenue Returns
• Payroll
• HR Advice

New business Supports:

Your local Enterprise board offers training and financial supports.

High Potential export business – Enterprise Ireland

If you are an employer - Creating new jobs, you may be qualify for exemption of employers PRSI for those jobs

First Steps finance offers low interest small loans to new start ups.

Most local high street banks have access to the European Investment Bank funding and can offer loans to the SME sector.