The Basics:

A Sole Trade business is generally one that operates under the owners own PPS number and a tax return is filed once a year. A company is a separate legal structure and there are both a company and personal tax return to be filed by the business owner each year. In order to operate as a company, a company structure needs to be formed with the Companies Registration Office (CRO).

Advantages and disadvantages of a Limited Company:


  • Company profits are taxed at 12.5% – One of the lowest rates in the EU – (trading companies)
  • Limited Liability
  • Greater pension options
  • Participation exemption on capital gains tax
  • Options with raising capital
  • Possibility of start-up tax relief

With advantages there are always going to be disadvantages

  • Setup costs and extra annual fees
  • Availability of losses may be restricted
  • Company Names are subject to restrictions
  • Extraction of profits
  • Close Company Surcharge for certain businesses
  • Certain company accounts details are published with CRO

Unfortunately, there are no right or wrong answers when setting up a company first day, each individual business is different. A company looking to get outside investment possibly won’t need the same business structure as a micro business that is looking to operate from their own home.

If you wish to know more, please get in touch.