Starter Business Questions

dutopia

Hi all,

I'm starting a business and I have a couple of questions I'd some some help with. I know there's a lot of information on Revenue's website but I still want to talk to a real person.

I have registered as a sole trader with the CRO and have a business name.
I have secured a .ie name using the CRO documents.

• My turnover for the year will not exceed €37k, which means I don't have to register for VAT (the business is providing a service). So that means I don't have to charge customers any VAT as long as the yearly turnover doesn't exceed that amount, right?
• So what tax does the government get from me running my business if I'm not charging VAT?
• I'm also an employee for a company, does this change anything?
• If I'm not charging VAT, can I still claim VAT back from business expenses?
• If I'm working from home, can I claim anything as business expenses?

Also is there any other information I should know at this stage?

Moomat

Best of luck in your venture! See some answers below in bold

dutopia wrote: »

Hi all,

I'm starting a business and I have a couple of questions I'd some some help with. I know there's a lot of information on Revenue's website but I still want to talk to a real person.

I have registered as a sole trader with the CRO and have a business name.
I have secured a .ie name using the CRO documents.

• My turnover for the year will not exceed €37k, which means I don't have to register for VAT (the business is providing a service). So that means I don't have to charge customers any VAT as long as the yearly turnover doesn't exceed that amount, right? Yes, you're right.
• So what tax does the government get from me running my business if I'm not charging VAT? If you earn enough you will pay Income tax, PRSI & USC Don't forget preliminary tax will have to be paid also. Example:If your accounting year is from 1 January to 31 December each year, you will pay Preliminary Tax for 2013 by 31 October 2013, based on an estimate of your liability for the full year. At the same time you will make a tax return for 2012 and pay any taxes outstanding for that year.
• I'm also an employee for a company, does this change anything? Unused credits and allowances can be used against your self employed income.
• If I'm not charging VAT, can I still claim VAT back from business expenses? No
• If I'm working from home, can I claim anything as business expenses? Yes, a certain percentage of light & heat and possibly some other business related utilities I think.

Also is there any other information I should know at this stage? Yes, strongly consider setting up a limited company if your liability increases as the business grows. Also get an accountant, don't try to do it own your own at the beginning. Your time would be much better spent growing the business.

dutopia

Excellent and clear answers, thank you.

For this point:

If you earn enough you will pay Income tax, PRSI & USC Don't forget preliminary tax will have to be paid also. Example:If your accounting year is from 1 January to 31 December each year, you will pay Preliminary Tax for 2013 by 31 October 2013, based on an estimate of your liability for the full year. At the same time you will make a tax return for 2012 and pay any taxes outstanding for that year.

How do I register to pay these taxes? I have a PAYE account on Revenue for myself as an employee. Is there a business equivalent? From Revenue's site it looks like it's ROS... but I don't know where to start here:

https://www.ros.ie/acl/apply_ran/step1?language=en&country=IE

Any ideas?

sawdoubters

you will have to charge customers vat

If your customers are themselves VAT registered, they are entitled to claim back the VAT you charge them against the VAT that they owe. Thus

http://www.mybusiness.ie/index.php?option=com_content&task=view&id=88&Itemid=27


http://www.bullethq.com/blog/vat-registration-tax-advice-for-small-business-in-ireland-from-bullet/

Peterdalkey

sawdoubters wrote: »

you will have to charge customers vat

If your customers are themselves VAT registered, they are entitled to claim back the VAT you charge them against the VAT that they owe. Thus

http://www.mybusiness.ie/index.php?option=com_content&task=view&id=88&Itemid=27


http://www.bullethq.com/blog/vat-registration-tax-advice-for-small-business-in-ireland-from-bullet/

You will not have to charge VAT while turnovers under the threshold for services.

You can return your income from these activities on your standard income tax form. There is a section for other income as in interest, rent, dividends etc etc. if you have specific queries, ring your local Revenue Office as listed in your TFA docs. They are extremely helpful.