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LLC v Sole Trader for Start Up

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  • 14-05-2012 7:07pm
    #1
    PhotogTom
    Registered Users Posts: 194 ✭✭


    Hi,

    Looking for some advice here.

    I'm starting up a company and trying to decide whether to start out as LLC or sole trader and convert to LLC "when I get bigger"!

    As a business,

    1) I'll be entering into contracts with other businesses (it is a service/consultancy oriented business)
    2) I'll be VAT registered from the start
    3) Initial cash flow will be quite low with no real overheads and no product to buy/stock/sell
    4) No employees for the first year or two

    Initially, I had thought the Sole Trader route would be fine. Point one above made me think the LLC might make better sense. With relatively low turnover to start, I don't think the tax issues are anything major one way or the other.

    What do you think? Am i missing any important questions here?

    Thanks!


Comments

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    #2
    mneylon
    Registered Users Posts: 7,739 ✭✭✭mneylon


    LLC is an American concept.

    If you're in Ireland you'll either be a sole trader or go down the limited route

    See http://www.cro.ie for details

    Blog | Tweets



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    #3
    marley123
    Registered Users Posts: 1,010 ✭✭✭marley123


    You can also look at going down the " umbrella" route - I am working as a contract sales consultant & have an accounting company specialising in contractors handle my invoicing etc... as I am classed as working under their umbrella they also handle my invoicing, paye, vat etc - as far as I am concerned it has been hassle free - they take a set amount in fees every month which takes the stress out of it for me.


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    #4
    ssbob
    Registered Users Posts: 2,736 ✭✭✭ssbob


    marley123 wrote: »
    You can also look at going down the " umbrella" route - I am working as a contract sales consultant & have an accounting company specialising in contractors handle my invoicing etc... as I am classed as working under their umbrella they also handle my invoicing, paye, vat etc - as far as I am concerned it has been hassle free - they take a set amount in fees every month which takes the stress out of it for me.

    You are a sole trader Marley.


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    #5
    PhotogTom
    Registered Users Posts: 194 ✭✭PhotogTom


    Thanks for the responses. I thought the LLC stood for limited liability company - is that now what you mean by limited as opposed to sole trader.
    LLC is just now catching on in America. Inc would be much more common.
    Anybody know what the pros/cons are in terms of both legal liability and tax liabilities? Again, keep in mind that I won't be making a lot of profit in the first year.


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    #6
    ssbob
    Registered Users Posts: 2,736 ✭✭✭ssbob


    PhotogTom wrote: »
    Thanks for the responses. I thought the LLC stood for limited liability company - is that now what you mean by limited as opposed to sole trader.
    LLC is just now catching on in America. Inc would be much more common.
    Anybody know what the pros/cons are in terms of both legal liability and tax liabilities? Again, keep in mind that I won't be making a lot of profit in the first year.

    Well basically Photg, I would ask a few questions first, what area are you going into? This makes a difference.

    What I would probably advise you to do would be to start out as a sole trader and then at some stage if you feel you need the protection of a ltd company then you can always move to that afterwards.


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