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  • 28-02-2017 1:09pm
    #1
    Miss OMMC
    Registered Users Posts: 82 ✭✭


    Hi there,

    My partner is currently a sole trader and sells products he makes to consumers worldwide (90% USA). The business is going well but is due to do a lot better this year. Projected revenue of €150k plus with a gross profit of about 60%.

    Obviously, keeping the tax bill to a minimum is a priority so would a limited company be the best route to take at this point? The business is quite a simple set up in that the costs involved are mainly just materials, shipping and some maintenance costs. There's no travel/entertaining etc so claiming expenses through a limited company would be difficult. If an LTD is overkill we'd like to avoid it.

    If he were to remain as a sole trader and I was to also set up as a sole trader (effectively splitting the business), is this lawful? We currently share the workload and as we sell a couple of different products, it could easily be split.

    Obviously we'll speak to an accountant but I just hoped to get some advice here first.

    Thanks


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    #2
    jimmii
    Registered Users Posts: 14,810 ✭✭✭✭jimmii


    A that revenue it's definitely time to consult an accountant and go through your exact situation a good accountant will save you more than they cost. Without knowing more about your personal circumstances and the nature of the business it's going to be hard to know exactly which route is best.


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    #3
    pedroeibar1
    Closed Accounts Posts: 5,108 ✭✭✭pedroeibar1


    There are a few issues to deal with in your questions.
    Firstly, taxation. If you have a company there will be two tax amounts, one paid by the company and another when you take money out as income. The costs and overheads will be taken into account - your accountant will explain the advantages/disadvantages to you.
    Secondly you need to consider personal liability. As a sole trader all your assets are on the line; by trading as a company you will have limited liability. I have a post on it here that explains what I’m on about.
    Lastly, for you to set yourself up as a sole trader you simply need to register a business name suitable to the part of the activity you do and it is perfectly legal for you to trade that way. (e.g. MissOMMCC Trading as OMG Widgets)
    Keep an open mind until you & partner talk together with the accountant


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