Ireland is an attractive place to do business due to a variety of factors, including:
- A highly educated and skilled workforce
- Low corporate tax rate (12.5%)
- A supportive government with favourable business regulations
- An English speaking population
- Proximity to other European countries
- A strong infrastructure and access to international markets
- Access to skilled financial and legal professionals
- Incentives for foreign direct investment
We have used our 30 years of commercial, legal experience to create this guide to opening a company in Ireland.
Some key considerations
New companies in Ireland will need to consider the following in order to be legally formed.
- A unique name: The proposed company name must be unique and not already in use by another Irish company.
- Do you need at least one company director? The company must have at least one director (depending on the structure) who is responsible for the statutory obligations. At least one director must also be ordinarily resident in the EEA (European Economic Area). A limited company can be a single-director company, whereas a sole trader will not need company directors or shareholders.
- At least one shareholder: Some Irish companies must have at least one shareholder who owns a portion of the company.
- A registered office address: The company must have a registered office address in Ireland where official documents can be sent.
- A company constitution: The company must have a written constitution that outlines its internal rules and regulations.
- A company secretary: The company must have a company secretary who is responsible for administrative tasks and ensuring compliance with legal requirements.
- Payment of required fees: The company must pay the required fees to the Companies Registration Office (CRO) to register and maintain the company’s legal status.
- Each director must obtain a personal public service number (PPSN) and provide it to the Companies Registration Office (CRO) in order to become a director.
Decide on the company structure
Ireland has a wide variety of business structures available for companies to register, depending on their size and purpose.
Private Company Limited by Share
The most common form of company entity is the Private Limited Company (LTD), which can have between one and 149 members or shareholders.
Public Limited Company
A Public Limited Company (PLC) is similar to a limited company in Ireland but must fulfill stricter regulations regarding financial reporting, and they must also have at least seven members and €25,000 in paid-up share capital.
Partnerships
Comprise at least two people who have unlimited liability should there be any losses incurred.
Sole Trader
This is the simplest type of trading entity and most common form of business structure, where the owner is responsible for all aspects of the business.
Limited liability partnership (LLP)
An LLP is a partnership where the partners have limited liability for the debts and obligations of the business.
Designated activity company (DAC)
A DAC is a type of company that is required for certain regulated industries, such as financial services.
Unlimited company
An unlimited company is a type of company where the liability of the owners is not limited, meaning they are personally liable for the debts and obligations of the business.
All companies registered in Ireland are required to comply with legislation that governs how the business runs, and failure to do so can result in hefty fines.
Company name
When choosing a company name in Ireland, there are several rules and regulations that must be followed. These rules are designed to prevent confusion with other companies and to ensure that the name is appropriate for use as a business name. Here are some of the key rules and regulations around company names in Ireland:
- Uniqueness: The name of the company must not be too similar to the name of an existing company. A name can be considered too similar if it is likely to cause confusion with an existing company name.
- Availability: The name must be available for use. This means that it cannot already be registered or reserved by another company.
- Appropriate: The name must be appropriate for use as a business name. Offensive or inappropriate names will commonly be rejected.
- Legal structure: The name must include an appropriate legal ending that corresponds with the type of company being formed. For example, a private limited company must have “Limited” or “Ltd” at the end of its name.
Register your company
- Choose your company name that complies with the rules and regulations of the Companies Registration Office (CRO).
- Prepare your documents including the constitution, details of the company’s directors and shareholders, and complete Form A1.
- Register online: The quickest and easiest way to register your company is through the CRO’s online registration system. You will need to create an account and submit your documents online.
- Pay the registration fee: The registration fee varies depending on the type of company you are registering. As of 2023, the fee for registering a private limited company is €50, while the fee for a public limited company is €300.
- Receive your certificate of incorporation: Once your application has been processed and approved, you will receive a certificate of incorporation from the CRO. This certificate confirms that your company has been registered and is now legally recognized in Ireland.
Set up a business bank account
Having a separate business bank account is crucial for several reasons. It helps to keep your personal and business finances separate, making it easier to manage your business finances and track your expenses. It also helps to establish your business as a separate legal entity, which is important for tax and legal purposes.
In Ireland, there are several banks that offer business accounts, including Bank of Ireland, AIB, Permanent TSB, and KBC Bank Ireland. Each bank has its own set of features, fees, and requirements, so it is important to compare the different options and choose the one that best suits your business needs.
The process of opening a business account in Ireland usually involves the following steps:
- Choose your bank: Research the different banks that offer business accounts and choose the one that best suits your needs.
- Gather your documentation: To open a business account, you will need to provide certain documents, including proof of identity, proof of address, and proof of business registration.
- Schedule an appointment: Contact the bank and schedule an appointment to open your account. Some banks allow you to book an appointment online.
- Attend the appointment: Attend your appointment at the bank and bring your documentation with you. You may also need to provide additional information about your business, such as your business plan, financial projections, and cash flow forecast.
- Complete the application: Fill out the application form provided by the bank, and provide any additional information or documentation that is requested.
- Wait for approval: Once you have submitted your application, the bank will review your information and make a decision on whether to approve your account.
- Activate your account: Once your account is approved, you will need to activate it by making an initial deposit.
The documentation required to open a business account may vary depending on the bank and the type of account you are opening. Generally, you will need to provide the following:
- Proof of identity: This can include a passport and/or driver’s license. Usually two form of ID are required.
- Proof of address: This can include a recent utility bill or bank statement. Usually two utility bills are required.
- Proof of business registration: This can include your company registration number or business name registration. You will have to also furnish the original of your Certificate of Incorporation and a copy of the company’s Constitution.
In conclusion, having a separate business bank account is essential for managing your business finances and keeping your personal and business finances separate. There are several banks in Ireland that offer business accounts, and the process of opening an account typically involves providing certain documentation and attending an appointment at the bank. By choosing the right bank and following the necessary steps, you can set up a business account that meets your needs and helps your business succeed.
Registering for taxes
Businesses operating in Ireland are required to pay several different types of taxes, including corporation tax, value-added tax (VAT), and payroll taxes. Here’s a brief overview of each type of tax and how to register for them.
Corporation Tax
All companies operating in Ireland must pay corporation tax on their profits. The current rate of corporation tax in Ireland is 12.5% for trading income. Corporation Tax for passive or non-trading income is 25%. To register for corporation tax, you will need to complete a Form TR2 and submit it to the Revenue Commissioners. You can register for corporation tax online using the Revenue Online Service (ROS).
Value-Added Tax (VAT)
VAT is a tax on the sale of goods and services. Most businesses in Ireland are required to register for VAT if their annual turnover exceeds €37,500 (as of 2023). The current standard rate of VAT in Ireland is 23%. However, different rates applies to different goods and services. To register for VAT, you will need to complete a Form TR1 and submit it to the Revenue Commissioners. You can register for VAT online using the Revenue Online System (ROS).
Payroll Taxes
If you have employees in Ireland, you will need to deduct payroll taxes from their wages and remit them to the Revenue Commissioners. Payroll taxes include income tax, social security contributions, and the Universal Social Charge (USC). To register as an employer, you will need to complete a Form TR1 and submit it to the Revenue Commissioners. You can register as an employer online using the ROS.
Capital Gains Tax
Capital gains tax is a tax on the profit made from the sale of an asset, such as property or shares. Companies operating in Ireland are also subject to capital gains tax. The current rate of capital gains tax in Ireland is 33%. There is a higher rate of 40% that applies to certain foreign life assurance policies and units in offshore funds.To register, you will need to complete a Form CG1 and submit it to the Revenue Commissioners. You can register online using the ROS.
Get any necessary permits or licenses
Depending on the type of business, permits or licenses may be required in order to operate lawfully.
Common permits include planning permission for the change of use and development of land and properties and health and safety permits for certain enterprises such as manufacturing.
It is important to research what type of license or permit applies to your business before you undertake any activities. Licenses and permits must usually be applied for in advance, so it is recommended that you investigate at an early stage of setting up your enterprise.
The government websites or local authorities in your area can provide comprehensive information regarding their respective regulations; alternatively, a legal advisor should be able to help you navigate through the process of obtaining any necessary licenses or permits safely and efficiently.
Can Foreigners open business in Ireland?
Yes, foreigners can open a company in Ireland. In fact, there are numerous benefits to setting up a business in the country for foreign entrepreneurs. Non-residents must register their company with the Companies Registration Office (CRO) and meet all applicable legal requirements, including obtaining necessary licenses or permits relating to the industry they operate in.
How much does it cost to open a small business in Ireland?
The cost of opening a small business in Ireland can vary depending on several factors, such as the type of business you are starting, the location of your business, and the specific requirements of your industry. However, here are some of the common expenses you can expect to incur when starting a small business in Ireland:
- Company registration fees: To register a company in Ireland, you will need to pay a fee to the Companies Registration Office (CRO).
- Legal and accounting fees: You may need to hire a lawyer and an accountant to help you with the legal and financial aspects of starting your business. The cost of these services can vary depending on the complexity of your business and the fees charged by the professionals you hire.
- Business premises: If you need to rent or buy a physical location for your business, this can be a significant expense. The cost of business premises can vary depending on the location, size, and condition of the property.
- Equipment and supplies: You may need to purchase equipment and supplies to start your business, such as computers, furniture, inventory, and office supplies. The cost of these items can vary depending on your specific needs.
- Marketing and advertising: To promote your business and attract customers, you may need to spend money on marketing and advertising. This can include creating a website, printing business cards, and running online ads.
Can I open a company in Ireland online?
Yes, it is possible to register a company in Ireland online. The Companies Registration Office (CRO) offers an online registration service called CORE (Companies Online Registration Environment), which allows individuals to register a company, file annual returns, and update company details electronically. However, we can efficiently look after the registration for you and ensure all of the forms are filled out correctly in order to ensure your application is not rejected.
For help with the company formation process, get in touch with our team here.
