What new companies can expect in their first six months

The first six months can be a steep learning curve, especially if you don’t know what to expect. There are registrations and deadlines due during this time that could get you on the wrong foot if you miss them.

Make sure your company is compliant from the beginning by familiarising yourself with what’s required.

If you need help, don’t have the time or resources to look after your compliance, we’re here to support you.

In this guide, you’ll learn what you need to do to ensure your new company is compliant during its first six months.

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Company formation in Ireland

New companies are set up by the Companies Registration Office (CRO). If you’re not sure of the steps involved, check out our guide on Setting Up A Limited Company in Ireland. The CRO takes care of processing and approving your new company application and gives you your company number and Certificate of Incorporation.

Irish company formation is done through a form A1 and the form must be submitted to the CRO alongside a company constitution. There are certain costs to set up a Limited Company, so be sure you’re aware of what you can do yourself and what you need to outsource.

Information required to register an Irish Limited Company:

  1. Unique company name
  2. Director(s), Company Secretary and shareholder(s)
  3. Registered office address
  4. Business address
  5. Share capital

Corporation Tax registration

Corporation Tax applies to all Limited Companies in Ireland, not just large corporations (as the name might suggest).

Companies register for Corporation Tax through Revenue and it’s done before the company starts trading or invoicing clients.

If you set up a company and don’t register for tax, Revenue will ask you to complete a Company Statement of Particulars within 30 days of receipt of the request. This statement details the nature of the company.

New companies that don’t register for tax or complete the Statement of Particulars are notified to the Registrar of Companies (CRO) and the CRO may begin the strike-off process under Companies Act 2014. The company Directors and Company Secretary may also be liable to a separate penalty under the Taxes Consolidation Act 1997.

On the other hand, don’t fear Revenue or the CRO as they can usually offer great advice to new companies if you communicate early with them. But this situation is avoidable if you know what you need to do in your first six months.

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VAT registration

Many companies want to register for VAT from the outset, and it can be a tricky process if you don’t know what Revenue are looking for.

It’s also a long process that can take up valuable time in new companies. It can take up to 28 working days to get a VAT number in Ireland and in the meantime, Revenue may ask you to provide evidence you need a VAT number before they process your application.

You can check out our guide for more information on How Do I Register For VAT In Ireland.

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Registration of Beneficial Owner

New companies have five months to register their company’s ultimate beneficial owner with the Central Register of Benefical Ownership (RBO).

Beneficial ownership refers to the natural person(s) who ultimately owns or controls more than 25% of the shares/voting rights/ownership interest in a company.

Registering this person is done online through the RBO website and the ultimate beneficial owner needs to have a Personal Public Service Number (PPSN) or they’ll need to complete a BEN2 form and upload it to the RBO website.

This registration is legally required and failure to register properly is a criminal offence and can result in a fine or even conviction.

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Annual Returns

All companies incorporated in Ireland have an Annual Return Deadline (ARD) as soon as they are set up.

Annual Returns are monitored by the CRO and completed through a Form B1. The first Annual Return gives the CRO information about the company such as the stakeholder and share capital situation.

  • A company’s first Annual Return is due 6 months after incorporation.
  • Annual Returns are filed online through CORE.ie or through Company Secretarial software.
  • A company has 28 days after its ARD to file its Annual Return online.
  • Once it is filed, you will receive a PDF of the Form B1, which you will need to print.
  • Once it is filed online, you are given a further 28 days to gather the signatures of one Director and the Company Secretary and mail the original copy to the CRO in Dublin.

This can be a long process and there are penalties if done incorrectly. Talk to us if you have any questions about our compliance services, we’re always happy to help.

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What happens if you miss an Annual Return?

As you can see there are strict dates around your Annual Return filing that you need to follow or you risk missing your deadline. But what happens if you have a missed Annual Return deadline?

  1. Fines. If you miss any of the steps by one day (for example, you file on the 29th day or there was an error with the post and the Form B1 arrives in the CRO after 28 days), your company will be fined €100 and an additional €3 per day missed thereafter.
  2. Loss of audit exemption. This doesn’t apply to first Annual Returns but it is good to note. Second and all subsequent Annual Returns are due every 12 months and are required to be filed with a set of abridged accounts. If you miss any of the aforementioned steps, your company will be fined and you’ll lose your audit exemption. You’ll need to hire an auditor to audit your financial statements and this is a very hefty cost to bare in your first year in business.
  3. Strike-off. If your company makes no progress in filing its Annual Return, the CRO will start to strike-off your company unless the correct compliance requirements are completed. This is called involuntary strike-off.

We’re here to help you file your Annual Returns and prepare your abridged accounts. We will prepare the Form B1 and send you regular reminders to make sure you don’t miss any of the deadlines.

Where to start?

The compliance requirements for new companies can be complicated and cause stress for new business owners. Our advice is to start by recognising what you can do and what you can outsource.

If cash is tight, consider joining a free webinar or start by outsourcing the big tasks, like your Annual Return. You might also be interested in reading about the costs involved with setting up a company in Ireland.

We offer a full range of services from that’ll help you succeed in business. We cater to your needs from Company Formation to Accountancy Services. Talk to us today and find out how we can help.

We’re always happy to help you decide what services best suit your needs.

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