5 Steps after Company Formation

5 Steps after Company Formation
5 Steps after Company Formation

Congratulations, you have registered your company with the Companies Registration Office (CRO) and just received the Certificate of Incorporation via email. Your startup venture is ready to begin. So what's next? What are the critical steps that you need to act on?

Here are the 5 important steps to take once the company is formed.

1. Tax Registration

When a company commences to trade it must, within 30 days, register for Corporation Tax with the Irish Revenue Commissioners.

  • Payroll Tax - We recommend that you register the company for payroll tax by default. As a result of PAYE Modernisation, a payroll submission is not required where an employer has not made any payment to staff during a pay period.
  • VAT - VAT registration can take a number of weeks, so it is important to start the registration process as early as possible. VAT Registration is mandatory if certain thresholds or conditions are met. However, please be aware that the Irish Revenue have refused VAT registration of businesses who cannot demonstrate intent to trade in Ireland.
  • Director Income Tax Registration - Proprietary directors of the company will be expected to register for Income Tax at the same time as registering the company for Corporation Tax and file Income returns annually with the Revenue Commissioners.

Once your company is registered for taxes, register for ROS so that you may view and file your tax returns online. Given the complexity and risk involved, you may want to have a Chartered Accountant file the tax returns.

If your company is not already being registered for tax, then you should speak to Incorpro.

Find out more about Tax Registration

2. Register of Beneficial Ownership

Newly incorporated limited companies in Ireland have 5 months to register the details of their beneficial owners with the Register of Beneficial Ownership (RBO). There is no exception to this rule and failure to comply can result in significant fines.

A beneficial owner is any individual who ultimately owns or controls a company, either through direct or indirect ownership of 25% of the shares or voting rights or ownership interest in the company. If the beneficial owner does not hold a PPS Number, then a Form BEN2 must be completed.

If you setup your company through Incorpro, we will file the beneficial ownership details with the RBO upon incorporation.

Find out more about the RBO requirements

3. Open a Bank Account

It is important that you keep your company's transactions clearly separated from your personal finances. It can take a number of weeks to open a bank account so it is important to start the process as early as possible.

Your personal banking provider - such as AIB, Bank of Ireland, PTSB - is a good place to start when opening a bank account for your company. Otherwise, you could try the online banks, such as Fire and Revolut, although their fees may be higher.

All expenses of the company should be paid from the company bank account. The company bank account could be funded by a Directors Loan so that these expenses can be paid.

4. Bookkeeping Software

Bookkeeping software is essential for any Irish company. Today's online bookkeeping software is powerful yet simple to use, designed for owner-managers so that they can monitor and control the company's day-to-day finances without the need to engage a bookkeeper. Monthly subscriptions for cloud accounting software range from free to €40+ and often result in reduced accountant fees at year end.

XERO is at the other end of the cost spectrum, with prices starting at $30 for the standard package and a lot more features.

Lesser known in Ireland, Zoho Books at €19 per month for their standard package is a powerful bookkeeping software that's part of the Zoho suite of apps. This is the bookkeeping software that we use for our firm’s accounting and we recommend it to our new clients.

5. Keep up to date with tax and legal requirements

After incorporating, you will need to have a clear idea of what documents you are required to send to the Companies Registration Office (CRO) and the Revenue Commissioners. The Annual Return, for example, is compulsory and must be filed with the CRO 6 months after incorporation and every year thereafter, even if the company is dormant.

Revenue require VAT registered companies to file VAT returns every two months and to submit Corporation Tax returns within 9 months of the accounting period end. Directors will also be required to file Income Tax return. Failure to file returns on time could result in fines are legal action being taken against the company.

Anything else?

Other points to think of are the following:

  • Company Seal - You may want to order a Company Seal at a cost of €49 + VAT to stamp share certificates and company documents.
  • Business Name Registration - If the company is trading under a different name, it may need to Register a Business Name. The CRO have an information leaflet with a full explanation regarding the business name requirements.
  • Website - A website is an obvious necessity these days. Incorpro offer website design services with different packages to suit your business.
  • Local Enterprise Office - Your Local Enterprise Office is a great resource for any entrepreneur or startup. They offer free support, online training and advice on government grants and financial assistance.

We have just touched on the accounting related steps above. You should also consider the specific issues that may affect your business, such as patent registration and, very importantly, insurance.

If you would like to speak to us about any of your accounting and tax needs, call us on 01-4429409 or find more contact information here and follow us on twitter for updates.


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