Limited company or not?
Most small businesses are organised as limited companies. A limited company is straightforward to set up and it only takes 30 minutes to get it sorted out.
1. Choose a name. This can something meaningless like the combination of 2 real words, or it can be something as important to you as the name of a historical figure. Either way there are many aspects to consider. You can go to our form to check your limited company name here http://www.osamcquillan.ie/eazy-company-formations/ to check to see if the name is available. Either way make sure the name is easy to pronounce and see that it looks okay in a website or email address. It will appear everywhere, from bank statements to websites, email addresses, letters, Revenue documents and accounts.
2. Form your limited company. We can help you do that - we dont have to be your accountants, but obviously we'd love if you appointed us to look after your new company. When you are forming your limited company you will need to consider where to have the registered office, and as part of any of our monthly paid packages we offer the facility of a free registered office. Otherwise you need to use an address that you will have access to and you can rely on getting the post, because all official post wil be sent to the registered office. You will need at least one director and a secretary. The secretary can be a corporate person i.e. a limited company but the director has to be a real person. You need to decide who the shareholders of the company are, for most contractor this is the contractor themselves. You only need one shareholder. Lastly you need to decide what the main aims of the company are - most peoplw know what their main focus will be so this is not a problem.
3. Appoint a firm of accountants. We are in the business of looking after businesses accounts and tax returns - we are really in the business of selling peace of mind, knowing that all the formalities are looked after. If you appoint us as your accountants we can keep you on the straight and narrow and ensure everything is kept up to date. You dont have to have accountants, but if you are not an accountant then there is the maze of Revenue forms to fill out each year, the Companies Office to deal with if you have a company, and also even deciding what VAT to reclaim - which are all bread and butter issues for accountants.
You can see a full list of our accounting packages here: http://www.osamcquillan.ie/register-with-us/
but to summarise we do:
* - these items are for limited companies only
If you deal with some of the record-keeping yourself we can do this for €120 per month plus VAT but you can see more about our packages on our Register with us page.
4. Register for taxes. This a job accountants usually do as you need to know what taxes apply to your business and an accountant can advise on that aspect. To register for taxes you will need to have a bank account. Once again this is an area we can help you with if you need an introduction to a local bank, and we can smooth the path for you with the bank.
If you are a contractor, a limited company is a useful vehicle for you, and there are many advantages to working through a comany as opposed to being a sole trader contractor.
There are 3 other options for people who decide to go contracting:
Self employment - become a sole trader. You just need to register with Revenue for any relevant taxes and you can start trading straight away. One major drawback is that all your personal assets will be exposed to being taken by creditors, and sometimes large comapnies don't want to deal with sole traders as the prefer to deal with companies.
Agency employee - you are an employee of an agency, who places you with their customer. You cannot write off any expenses, and usually you have no direct relationship with the end client. Unless you are getting great exposure to new work, or a great rate of pay you could not hope to get elsewhere, then this is often a poor option to take.
Umbrella company - we your accountants or an employment agency employ you through an umbrella company. You get some expenses deducted from your payment, and these expenses are paid to you tax free. The balance of your money is paid to you after deduction of PAYE and other taxes. This option is okay if you do't want to go to the trouble of setting up a limited company and then have the hassle of paying for the maintenance of the company, and especially if you don't know how long you will be contracting. However if you are intent on being a contractor for more than a few months and are earning more than €30,000 per year then a limited company is a far better option.