• Fitzgerald & Partners Kinsale
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  • Niche Business Advisory Firm
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  • No. 9 Pearse Street
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  • Kinsale
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  • TEL
  • +353 21 4774500

Frequently Asked Questions

How do I register for Tax?

You should advise Revenue when you start in business. You can do this by completing the appropriate registration form which is available from Revenue’s website www.revenue.ie, from Revenue’s Forms & Leaflets Service by phoning LoCall 1890 306 706, or from any Revenue office. The registration forms are:

  • Form TR1: this registration form is for Individuals/Sole Traders, Partnerships, Trusts or Unincorporated Bodies.
  • Form TR2: this registration form is for Companies (including foreign companies).
  • Form PREM Reg: this registration form is for Persons or Companies requiring to register as an Employer for PAYE/PRSI purposes only and who are already registered for Income Tax (either as self-employed or as an employee) or Corporation Tax.

If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form here.

Am I obliged to register for VAT?

You must register for VAT if you are a taxable person and your annual turnover exceeds or is likely to exceed the limits prescribed by law for registration. The following limits apply:

  • €75,000 in respect of the supply of goods,
  • €37,500 in respect of the supply of services.

If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form here.

Must I register as an employer for PAYE/PRSI if I employ staff?

YES. You must register for PAYE/PRSI if you pay:

  • €8.00 per week equivalent to €36.00 a month or more, to an employee who has only one employment,
  • €2.00 per week equivalent to €9.00 a month or more, to an employee who has more than one employment.

A company must register as an employer and operate PAYE/PRSI on the pay of directors even if there are no other employees.

If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form here.

I intend operating as a Principal Contractor, do I have to register now?

Yes. All Principal Contractors must be registered with Revenue. A Principal who fails to register with Revenue and makes payments without deduction of tax may become liable for the tax that should have been deducted. Penalties may also be applied for the non-operation of RCT.

If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form here.

I intend to operate as a Subcontractor. What arrangements should I make to keep my tax affairs in order?

All Subcontractors should be registered as self-employed with Revenue. If you intend to employ workers, you will need to register as an Employer for PAYE/PRSI purposes. If your turnover will exceed the VAT limits you must also register for VAT. If you intend to further subcontract any part of your contracts, you should also register as a Principal Contractor.

Subcontractors should keep all returns and payments up to date with Revenue. The Principal Contractor applies to Revenue for permission to make payments gross to the Subcontractor. Depending on the tax compliance of the subcontractor, Revenue will authorise the payment to the subcontractor subject to the deduction of Relevant Contracts Tax Rate at a rate of 0%, 20% or 35%.

If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form here.

How will I know what tax I have to pay and when to pay it?

As a self-employed person you will be taxed under the Self-Assessment system.
There is a common date for the payment of tax and filing of returns, i.e. 31 October. This system, known as “Pay and File”, allows you to file your return and pay your tax at the same time.

If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form here.

What is Preliminary Tax?

Preliminary Tax is your estimate of the income tax payable for the year and must be paid by 31 October. It includes PRSI and Universal Social Charge as well as Income Tax. The amount of Preliminary Tax you must pay to avoid a charge to interest is the lower of:

  • 90% of your final liability to tax for the current tax year, or
  • 100% of your liability to tax for the immediately previous year, or
  • 105% of your final liability to tax for the year preceding the immediately previous year. This option is only available where you authorise the Collector-General to collect tax by Direct Debit. The 105% rule does not apply where the tax payable for the pre-preceding year is Nil.

If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form here.

What happens if I don’t pay my Preliminary Tax on time?

If you don’t pay your Preliminary Tax by 31 October, if you don’t comply with the terms of the Direct Debit arrangement authorised by the Collector-General, or if the amount of Preliminary Tax you pay is too low, you will have to pay an interest charge. The effect of non-payment or payment of an inadequate amount, is that the full tax liability for the year becomes due on 31 October. Interest at the rate of just under 10% per annum, is payable on all late payments of tax.

If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form here.

How do I calculate my taxable profits?

You calculate your taxable profits by deducting allowable business expenses from your turnover.

If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form here.

What happens if my business makes a loss?

If you make a loss on your business activities you can either:

  • Set off the loss against other taxable income (if you have any),(this is now subject to strict restrictions ) or
  • Carry the loss forward to be set against future profits of your business.

You must indicate on your tax return how you wish the loss to be used.

If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form here.

How are Capital Allowances calculated?

Wear and Tear Capital Allowances on Plant and Machinery (including motor vehicles) is calculated on a straight-line basis at a percentage of the net cost. The net cost is the cost less any grants and any VAT, which can be reclaimed. Depending on when you purchased the item of plant or machinery, the rate of Wear & Tear on expenditure incurred on or after 4 December 2002 is calculated at 12.5% of the net cost.

If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form here.

How do I go about setting up a company?

If you wish to set up a company you should consider talking to us and/or solicitor first. Companies must be registered with the Companies Registration Office, 14 Parnell Square, Dublin 1. Once a company is registered it is a separate legal entity from the persons who formed it.

If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form here.

If I set up a Company, how will I be taxed as a director?

If you set up a company, the company will be obliged to register for and operate PAYE/PRSI on your salary as a director.

If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form here.

How is a Company Taxed?

Companies pay Corporation Tax (C.T.). This tax is charged on the company’s profits, which include both income and chargeable gains. A company’s income for tax purposes is calculated in accordance with Income Tax rules. Chargeable gains are calculated in accordance with Capital Gains Tax rules.

If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form here.

Am I obliged to keep records for tax purposes?

YES. You must keep full and accurate records of your business from the start. You need to do this whether you send in a simple summary of your profit/loss, prepare the accounts yourself, or, have an accountant do it. It is important for you to remember that the figures which are contained in your tax returns, your accounts, or your summary of profits/losses, must be correct.

The records you keep must be sufficient to enable you to make a proper return of income for tax purposes.

You should bear in mind that you may need to keep accounts for reasons other than tax. For example, your bank may want to see your accounts when considering an application for a business loan.

If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form here.

What is a Revenue Audit?

A Revenue audit is an examination of your compliance with taxes and duties legislation and Revenue requirements. Revenue audit covers the following types of tax returns:

  • Income Tax, Corporation Tax or Capital Gains Tax returns, and/or
  • Returns submitted in respect of VAT, PAYE/PRSI or Relevant Contracts Tax (RCT),
  • Returns submitted in respect of Capital Acquisitions Tax,
  • A statement of liability to Stamp Duties,
  • Customs, Excise and VRT Declarations.
If you require assistance or advice regarding this, please contact us at 021 4774500 or fill in our enquiry form HERE.