Some entrepreneurs start a business while working full-time because it is the only option for those who dream of owning a company.
Whether you have a brilliant business idea or great skills, you can leverage outside of your normal working hours, more and more people are considering starting a business alongside their 9-5.
Starting a business in Ireland when you work full-time can be very exciting but time-consuming and difficult if you don’t know what’s involved.
Here’s what you need to know and what you can outsource to us.
Can you be employed and self-employed at the same time in ireland?
Some companies may have formal policies in place that don’t allow employees to have their own business ventures outside of work. You should check your employment contract or speak to a colleague at work so you don’t get caught out.
Employment contract clauses
You should also consider the type of side business you are conducting. Does this directly conflict with your current job? Most companies have a clause around intellectual property and if you are using the information you acquired on the job, you may be liable for breach of contract.
Did you know your Pay As You Earn (PAYE) tax credits can be adjusted across two jobs? Therefore, your employer may see that your tax credits have decreased on your payslip if you decide to change your tax credits. This might prompt them to question the change, so telling them about your side business may be the only thing to do.
Entering gig economy
Gig economy refers to workers that work on a part-time or payment-by-task basis, for supply and demand jobs.
Some of the big names that use this system include Uber and Deliveroo, which started online businesses. But it also applies to professional workers like consultants, independent contractors, freelancers and “side hustlers”.
According to Deloitte’s 2019 Millennial Survey, the gig economy appeals to four in five millennials and Gen Zs. They state the chance to earn more money, working the hours they want or achieving a better work/life balance as reasons why to join the gig economy.
Interestingly, 61% would take gig assignments to supplement existing employment.
But how do these employees start a business with a full-time job? What should you consider before you make the decision?
Check your contract of employment
One of the main concerns our clients have before setting up their business is whether or not their employer will find out.
Although your employer would not be told directly by Revenue or the Companies Registration Office (CRO), there are other ways your employer could find out you have a side business.
Do you have time to start a part time business?
Many Irish employers are favouring flexible arrangements for their employees, such as remote working, compressed hours, 4-day weeks, etc. This flexibility means you may have spare time to work on your own business. Consider how much time you can dedicate to your new business while working full-time because it needs to be realistic.
As a business owner, you have certain accounting obligations that could cost you if not complied with. There are different compliance requirements if you decide to set up as a Sole Trader or Limited Company. There are pros and cons to each structure, but it’s important to consider the amount of time you will have to look after the financial side of the business.
How to start a business while working?
01. Business registration
The most popular types of business structures in Ireland are Sole Traders and Limited Companies.
Many of our clients start out as a Sole Trader and then change to a Limited Company at a later stage when they are confident in their business model and ready to commit to their business full-time. Setting up a Limited Company is usually more complicated but it benefits from profits being taxed at the Corporation Tax rate and more credibility in the industry.
There are advantages to either type and the type of structure you set up will depend on your circumstance. We recommend that you speak to a professional who help you with your specific needs.
While many entrepreneurs are focused on starting their business, it’s equally important to be informed about closing a limited company in Ireland if circumstances change. A voluntary strike-off is a common method to close a company, but it’s essential to ensure all requirements are met and liabilities are settled before taking this step.
02. Tax registration
The type of taxes you register for can vary depending on your industry and business activities. These are some of the taxes that are relevant to new businesses starting up in Ireland. Taxes for businesses in Ireland include: corporation tax, income tax, value-added tax, employer’s PAYE, and relevant contracts tax.
03. Annual compliance & year-end compliance
This is for Limited Companies only. It is an annual accounting deadline that required financial statements to be prepared and submitted to the Companies Registration Office (CRO.
Corporation Tax Return
This is for Limited Companies only. It is another annual accounting deadline that calculates the amount of tax due at the end of your company's financial year-end date.
Personal Income Tax Return (Form 11)
As a business owner, you need to file personal tax returns. If you are a director of a Limited Company and you have a full-time job on the side, you are obliged to file income tax returns as well.
This can apply to Sole Traders and Limited Companies, if your business is registered for VAT. If your business is not registered for VAT, you do not need to file VAT returns.
03. Company secretary
This only applies to companies in Ireland – Sole Traders don’t have company secretaries.
When you’re starting a new company, you are not allowed to be a one-director company and have yourself as company secretary. Therefore, many of our clients outsource their company secretary to a professional, like Accountant Online.
Understanding the advantages of company secretary services can be a game-changer; it ensures compliance and brings expertise to your operations. Entrusting this role to a professional service like ours not only meets legal requirements but adds a layer of efficiency and foresight in corporate governance.
This type of secretary is different from someone who answers your phone or assists you with your job. A company secretary is responsible for looking after certain aspects of your company, such as maintaining your Annual Return and informing the CRO of any changes to your company.
04. Mail correspondence address
To start a business with a full-time job may mean you need to start out at home.
Did you know that you need to display an Irish address when you’re setting up a company here? As well as that, your clients will be able to see this address when you send them invoices.
Because of this, it is very common for businesses to outsource their correspondence needs to a Registered Office Agent (ROA) such as us. Check out our Virtual Office in Dublin page for more information.
What are the next steps to get started?
Have you decided that starting a business with a full-time job is for you?
We’re here to help you along this business journey.
Our team of professionals help you each step of the way, to ensure your business is compliant with Revenue and CRO.
So let us know when you want to start, we’re ready when you are…
Tom is a Fellow Chartered Certified Accountant (FCCA) and Chartered Tax Advisor (CTA) and is Accounting Team Manager at Accountant Online. Areas of expertise include Accounting, Compliance, Taxation relating to small business and company directors.