Setting up as a sole trader with different income streams

bheart65

Hi Folks,

I apologise in advance for the naivety of my questions but here goes.

I am currently unemployed and thinking of setting up as a sole trader. I don't have big ambitions and would like to clear 5000 in year one if possible, with a view to increasing the income to in year 2 to equate to the Jobseekers payment.

I am wondering if you are limited to one business area when you set up as a sole trader or can you make money from different streams and count it as the one income eg. repairing small engines, selling small plant, and buying and selling a few cars through the margin scheme?

Would each separate area need it's own set of accounts? Would I need to set them up as individual businesses and can I even do that as a sole trader?

Thanks for your kind attention.

Regards,
Tom.

mrawkward

All income as a sole trader counts as one income, no limit on number of activities carried on.

bheart65

mrawkward wrote: »

All income as a sole trader counts as one income, no limit on number of activities carried on.

Thanks for that, much appreciated

hairyslug

I am a sole trader, when I was completing the forms on the core.ie site, I had to fill in a code that would relate to my business, in my case it was that I would be trading online. I do have plans in the future to move to an office base where customers can drop in (no street shop front). Do I need to set up under a new name with this new code (im sorry, I cant remember the name the CRO used)

mrawkward

Core is completely different dept to Revenue. As RBNs will allow the same business name to be used for different types of activity or even geographic areas, you might be best to have a separate name registered for that activity. None of this impinges on Revenue tax returns.

Mrs OBumble

mrawkward wrote: »

All income as a sole trader counts as one income, no limit on number of activities carried on.

True. But Revenue do ask you to break your income into the different business activities.

So at very least you need some sort of flag in your accounts so you can separate it out.

Gloomtastic!

Mrs OBumble wrote: »

mrawkward wrote: »

All income as a sole trader counts as one income, no limit on number of activities carried on.

True. But Revenue do ask you to break your income into the different business activities.

So at very least you need some sort of flag in your accounts so you can separate it out.

From memory, the last time I filled in my tax return, there was a single box with Business Activity assigned to it. Not sure how you'd list different ventures. And if you listed several in one box, how that would ever be recorded by Revenue.

I run two different businesses that I keep separate accounts for but amalgamate them into one income tax return. I only list one business activity.

Lockedout2

Gloomtastic! wrote: »

From memory, the last time I filled in my tax return, there was a single box with Business Activity assigned to it. Not sure how you'd list different ventures. And if you listed several in one box, how that would ever be recorded by Revenue.

I run two different businesses that I keep separate accounts for but amalgamate them into one income tax return. I only list one business activity.

Technically speaking that's not the correct way to fill in the return. You should complete the income figures for each trade separately on the return.

There are different rules for the commencement and cessation of a trade.

Gloomtastic!

Lockedout2 wrote: »

Technically speaking that's not the correct way to fill in the return. You should complete the income figures for each trade separately on the return.

There are different rules for the commencement and cessation of a trade.

But I don't, from what I remember about the current on-line tax return form, see how you could do that. Technically would you have to fill in multiple forms?

dbran

It can and should be returned as separate trades on the Form 11 and it can indeed be done properly online.

It would be incorrect to amalgamate them and there could be issues going forward with calculating the correct loss relief due cessation rules etc.

It may amount to the same thing in most cases and you would get away with doing it that way sometimes. But in other cases it would not.

Regards


Dbran

Mrs OBumble

Gloomtastic! wrote: »

From memory, the last time I filled in my tax return, there was a single box with Business Activity assigned to it. Not sure how you'd list different ventures. And if you listed several in one box, how that would ever be recorded by Revenue.

I run two different businesses that I keep separate accounts for but amalgamate them into one income tax return. I only list one business activity.

The last time I did a paper form 11, and there were definitely different columns (3-4 ? of them) to allow for multiple activities.

I only have to use ROS from this year, so haven't explored it yet. For 2015 I only have one stream, but it's quite possible I'll have more than one from 2016, so will be looking into stuff like this eventually.

bheart65

Thanks for all the help folks. Just wondering what accounting software you use/recommend? Thinking of one of sage start, xero, sortmybooks, any thoughts?

Gloomtastic!

OpenOffice Spreadsheet :rolleyes:

dbran

If your business is small and straightforward a simple spreadsheet should be enough. As it grows eventually you may need to consider getting a proper accounting package.

I would probably go for Xero if I had to chose.

Dbran