How to Start Your Own Business in Ireland

Are you eager to start your own business in Ireland but are unsure of the steps you need to take to achieve that goal? 

In this article, we’ve put together a step-by-step guide to starting a business in Ireland and walk you through the key steps and considerations you need to think about before you get started.

When you’re setting up a company in Ireland, it’s important to consider what type of business you’ll be running. 

Each type of business structure has its own pros and cons, with some types of businesses being more suited to bigger or smaller enterprises. 

Irish Entrepreneurs coming up with a business plan should consider the legal structure of their business, as this can affect the amount of income tax, corporation tax, tax relief and financial support your new business will be accountable for.

If you’re self-employed or a sole trader, you have no employer, and the services you offer are essentially your ‘business’. This means it’s your responsibility to keep all records of your business and submit your own tax returns.

Although the term ‘self-employed’ may suggest that you are working alone, you can employ full-time staff as a self-employed worker. In this sense, a self-employed person can essentially set up a business as a sole trader.

You will be liable to pay tax on any earnings above €5000 and must register as self-employed with The Revenue Commissioners.

A partnership is a type of business that is run between individual bodies or people who both have a goal of generating a profit by working together. 

This is different from running a business by yourself, as you’ll be expected to share profits and costs between you and your business partner. A partnership can be in the form of a Limited Partnership (LP) or a General Partnership (firm). 

The benefits of running a business in this way is that you’ll have access to another set of funding from your partner, and you may be able to help each other fill in the gaps you may have if either party was to set up an individual business. 

A limited company is a type of registered business that is an entity within its own right. This is separate from a sole trader business, as due to ‘limited liability’, you will not be personally liable for losses incurred by your business. This means that investors or banks may be more inclined to help you finance your business through loans or investments, as they know that they will have protections if your business goes bankrupt.

One of the benefits of setting up a limited company is you can choose to pay yourself a salary from the company as if you are a PAYE (pay as you earn) taxpayer or can pay yourself in dividends, which you’ll pay a smaller amount of tax on. 

For a smaller sole trader, you might pay more tax if you choose to become a limited company, but for large businesses, you can reduce the amount of tax you will end up paying as a limited company. Becoming a limited company is often a natural step up from a very small business that is seeing larger profits.  

To set up a limited company, you must register with the Companies Registration Office (CRO) and ensure that no other company shares your name. You can register your business name and file returns through the CRO’s Companies Online Registration Environment.

Now you know the basics of how to start a business in Ireland, it’s important to set budgets and set out some forecasts. This is important as you’ll need to be able to predict how much revenue you’ll be likely to generate so that you can invest in your business in a sustainable way. 

Budgeting can be done by calculating your outgoings and tax, and then weighing that against your income generated by the business. From there, you can work out how much you’ll make in profit, which will help you understand how much headroom you have for investment in your business, or whether you can extract more from your business to spend as personal income.

For smaller Irish businesses just starting out, being a known name within your industry can be vital. Although some businesses can thrive through simple word-of-mouth, understanding your market position and how to attract customers is important. 

You can either use your own skills (for example, a marketer setting up a small marketing business could apply their own skills within promotion), or you can hire marketing staff, or consider turning to an agency. 

Some simple market research can help new companies understand how to reach their desired customers. Start-up companies can have an advantage in this area as they can more easily allocate a larger budget to marketing and get their name out there with a unique proposition to customers.

If you’re planning to expand your business or take on additional staff, it’s important to ensure that your payroll is set up correctly. This means that staff can be registered properly, have information about their pensions, student loans and tax managed properly. 

When you’re running a business, employees who work for you should have the same protection regarding their remuneration as you. Whether payroll is something you manage yourself, use software such as Xero, or employ staff to manage your company’s payroll, it is an important factor in the day-to-day running of your business.

Setting up your own business in Ireland can be a daunting task, but there are steps you can take to prepare yourself for this venture. 

Courses in different areas can give you the skills you need to run a business independently. For example, Payroll courses or Xero courses can give you the skills needed to process employee wages, courses in Media can help you to produce marketing materials for your business, whilst qualifications in Finance, Accounting and Business Management can give you the confidence to manage technical aspects of your business without the need for outside help.

If you’re keen to get all of the skills you need quickly, you can explore The Career Academy’s Start Your Own Business course. This course goes through all of the aspects of setting up a business discussed in this article, is specialised for those setting up a business in Ireland, and can be completed in six months for under €600.