4 Main Taxes for Businesses in Ireland

I’m going to explain to you the four main taxes that you need to know about if you’re running a business in Ireland. 

4 main taxes in Ireland

It doesn’t matter if you’re running a company or if you’re just a sole trader, everyone pays taxes, and these are the four main taxes that you need to be concerned with: income tax cooperation, tax, VAT and employment taxes.

The only difference between income, tax and corporation tax is our income. 

Taxes for sole traders and corporation tax is for companies. You only really need to be concerned about VAT if your company meets certain thresholds. You shouldn’t worry about employment taxes either unless your company employs staff or you’re getting paid a salary through your company. So let’s get started. 

How do you register for taxes in Ireland?

When you incorporate the company, you should get a six-digit company number, which enables you to invoice your customers around the same time of incorporation. 

You should register for taxes, and you should do this using revenue online services (www.ros.ie ), which you can access on the internet. At abc.com At or OS dot ie, if you’re a sole trader, you won’t need to deal with the company’s registration office unless, of course, you are looking to get your own business name. But you will still need to register yourself with revenue online services, and you can do this using your own personal PPS book once you’ve registered for taxes. 

Tax filing obligations

It is your responsibility to both calculate and file and also pay your taxes to the Revenue. Commissioners, you’ll also need to keep your accounting records for at least six years in case of a revenue order, failure to pay or file your taxes can result in large fines and penalties, and some as high as five to ten per cent of the original tax, and then That also incurs interest every day at a rate of about eight per cent per annum, so it is quite a cumbersome and complex task, which is why so many companies hire accountants to look after this particular problem for them.

In Arden, companies pay twelve percent tax on their profits, while sole traders can be taxed up to forty per cent of their net profits. A company’s corporation tax return has to be fallen by the 23rd day of the ninth month after the financial year-end date.

Then you have to pay either 100 % of your prior year’s liability, which you’ve probably just calculated on your tax return or 90 percent of your current year, estimated tax liability. You can’t pay less than the lowest of these two figures. Also, if 2018 was a short year, meaning you only traded for a few months and you have to annualize it so divided by the number of months your company was in business and multiplied by 12 months. But when you have to perish in tax when you’re gonna love this one, it has to be 31 days before your financial year-end date and the 23rd of that month. Let’s break that down. Let’S say you have a flatterer urine date of the 31st of December 2020, so 31 days before, that is the 30th of November, which means we’re in November so take the 23rd of that month, which means you have to pay you preliminary tax on the 23rd of November 2020 for your financial year-end 31st of December 2020.

There’S some good news for start-up companies, though, in your first-year trade. If your tax bill is going to be less than 200,000 euros, which I’m assuming most people, it will be, you don’t have to pay preliminary tax in your first year of trade, instead, you’re gonna pay 100 % of the tax jook. When you follow your first corporation tax return, so because this date’s business is so confusing, I’ve decided to make an Excel calculator which is available for download in the link in the description below. Let’s go through the calculator now it’s it works very easily. You put in what today’s date is, so I have it set in a formula to give you today’s date you’re putting your incorporation date.

Let’s say it’s the 1st of July 2019 and then you put in your year-end date, which is going to say. The 31st of December 2019 notes – and this will give you when your preliminary tax payment date is – is the 23rd of September 2020. So how do I put in the incorporation data as being, let’s say, the first of July 2017, the primary tax date would have been the 23rd of November 2019. Okay, let’s say we are looking at the 31st of December 2018. You’ll see that all of these dates are passed and you’re late, if you haven’t filed or if you haven’t paid your tax VAT, which is a mandatory tax for all businesses.

In any 12 month period

If certain thresholds are met within a 12-month rolling period, if you have sold more than three thirty-seven and a half thousand euros worth of services or 75 thousand euros worth of goods, then you must register for that and make filings every two months. If you haven’t breached these thresholds, then you don’t have to register for VAT, but you can voluntarily choose to register VAT for it if you haven’t met these thresholds yet, but why would you want to do it well, for one you’d be able to claim back all The battery you paid on your company expenses also, if you’re selling to suppliers, they will be able to claim back the fact that you have charged them on your invoice, assuming they are also a VAT registered business.

Of course, it’s important to note, though, that there are different VAT rates if they knew you if they’re in the world and if you’re selling baby goods or if you’re selling professional services.

VAT3 – every 3 months

VAT returns are done every two months for every two month period and have to be filed Within 19 days of the last day of that two month period, the form you have to file is called a VAT3 form. 

VAT on sales

Basically, you put in all the VAT that you made on your sales and you put in all of the VAT that you purchased on all of your expenses, the difference between the two will need to be refunded to you. If your expenses were more than your sales or you have to pay the difference to the Revenue Commissioners, if your sales were more than your expenses 

Employment taxes

Before you make your first hire now you can get your accountant to do this or you can do it yourself on revenue online services. if you’re doing payroll yourself, you’ll need a payrolls offer which uses regular commissioners’ payroll modernization scheme as an employer. You are required by law to collect your employees’ taxes on the government’s behalf and pay them every month or every quarter. 

Whether you are looking for an accountant in Dublin, to outsource your payroll or outsource your bookkeeping please don’t hesitate to contact us.

This article is intended to inform rather than advise and is based on legislation and practice at the time. Taxpayer’s circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this article, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.

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