The Small Limited Company

It is important to note at the outset that a limited company is a distinct legal entity separate to its shareholders and directors. A limited company must have 2 directors but one person can own 100% of the shares. A director of a company has various legal rights and obligations and proprietary directors must file an annual income tax return.

The administrative and compliance obligations of a limited company are more onerous than that of a sole trader however the limited liability structure can offer major taxation advantages if the business makes good profits and the flow of income (e.g. salary or dividends) to the directors is controlled with a view to minimizing PAYE / PRSI or income tax.

If a business is incorporated the trading profits are liable to corporation tax at 12.5%. The director would normally then extract a salary from the company but he / she may be able to minimize it so that income tax is only paid at the 20% standard rate cut off point. Therefore there is an opportunity to control tax leakage when trading through a limited company.

Given that certain start-up companies may be exempt from corporation tax in each of the first three years of trading it may well be worth contacting us with a view to setting up a new company.

If you are unsure as to whether a limited company is the most suitable vehicle for your business please contact us for a complimentary meeting, email or discussion.

Clarus Taxation provides the following taxation compliance and accounting services for limited companies and directors:

• Company set up.
• Tax registration.
• Tax efficient salary planning.
• Preparation and filing of 6 bimonthly VAT returns and payment advice.
• Preparation and filing of 12 P30’s and end of year P35 and payment advice.
• Preparation of 6 bimonthly bank reconciliations (completed in conjunction with the VAT return).
• Preparation of end of year trading accounts.
• Preparation of company’s corporation tax computation and return (Form CT1).
• Advice on payment of correct amount of corporation tax on a timely basis.
• Verification of final corporation tax notice of assessment from the Revenue Commissioners.
• Preparation and filing of director’s income tax return (Form 11).
• Preparation and filing of company secretarial returns.

Fees

If you contact us for a fee quotation we can offer all or some of the tax and accounting services above that you need during the tax year as one package with one price.

Potential costs for annual work might typically start at €1,500 plus VAT for a company registered for VAT without employees apart from the directors.

Please note that company set up and tax registration represents a once off cost of €500 plus VAT but the fee may be waived in certain circumstances. See Introductory Offers.

The above is merely an indication and it would be necessary to discuss your affairs over a complementary telephone call or meeting. The complexity and the amount of transactions as well as the amount of turnover will all have a bearing on the fee quotation. Please note fees are payable over the course of the year by standing order and any introductory offers are dependent on this.