Where to start?

Do you have a business idea with the potential to trade online? This guide explains how to get your online business started.

Trading online can involve selling a product or service, or offering an online booking platform. How you trade online will depend on your business offering so some of these steps may not be relevant to everyone.

In the beginning, you may consider starting an online business at the same time as working a full-time job. But it’s important to understand that you need to register the business with Revenue and the CRO and look after the compliance requirements. Check out our guide on how to start a business while working for more information.

We’re here to support you through this process. We can help with Company Formation and Accountancy requirements. Talk to our Client Services Team about starting an online business in Ireland.

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Step 1: Decide how you want to sell online

Will you set up your own website, use a reseller platform like Amazon or eBay, or a mixture of online sales and offline sales?

Consider writing a business plan and doing research on what option is best for you. Writing a business plan will help you narrow your target audience and determine what your customers expect from your site. You should ensure you can meet your customer’s expectations.

Shopify and Squarespace offer templates for new e-commerce businesses. They’re easy to use and easy to manage.

There are also great tools online that help you manage your client’s expectations. For example, if you want your clients to book meetings with you, Calendly is a great platform to manage your appointments online.

Step 2: Sole Trader or Limited Company

Starting an online business means you need to officially register with Revenue and the Companies Registration Office (CRO).

Decide what business structure you want to be – Sole Trader or Limited Company. There are advantages and disadvantages to both business types.

In general, Sole Traders take on more risk than Limited Companies. Sole Traders are personally liable for the debts of the business therefore you may need to sell off personal assets to repay debts.

On the other hand, setting up a Limited Company may be the right option because the registration process creates a separate legal entity. This provides more security for you as you have limited liability as a company.

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How to register your online business in Ireland?

1. Register with the Companies Registration Office (CRO)

The first step to setting up a business in Ireland is to register your business with the correct authority. This is true for online businesses as well. You need to register with the CRO if you want to incorporate a company. Sole Traders only need to register with the CRO if you want to register a business name.

We can look after all this for you with our Irish Company Formation service. You provide us with information about your new online company and we prepare the paperwork (form A1 and Consitution).

2. Register with Irish Revenue

Both Sole Traders and Limited Companies need to pay tax so it’s important you register for tax before you start selling online. Sole Traders register as self-employed and Limited Companies register for tax with Revenue.

The amount of tax you pay depends on the size and type of your business and what sector you belong to. So each business may require different tax registrations. You should always seek an accountants’ advice to ensure you comply with your obligations as an online business.

3. Set up a business bank account

It’s wise to set up a bank account for your online business transactions. Bookkeeping will be easier and therefore preparing financial statements will be more efficient. Check out our post on the best business bank account for small businesses for more information.

Sole Traders don’t need to prepare financial statements. But, similar to companies, they do need to keep clear records in case of a Revenue audit. It’s also important to keep track of your expenses so you can claim them against your tax liability. Check out our post on tax-deductible expenses for companies and sole traders for more information.

There are many different banks so be informed about the best banks in Ireland.

Step 3: Build your brand, website, and social media presence

Starting an online business means you need an online presence to stand out from your competitors.

There are many different agencies and consultancies you can use to help you build your brand if you don’t have experience. Website design, search engine optimisation, branding, digital marketing, and user experience are all areas you can hire experts in.

Step 4: Focus on your analytics

Starting an online business means you can use software like Google Analytics to track the success of your website.

Visitors, conversions, and average order value per customer are all interesting statistics that can help you understand your business.

Online e-commerce platforms like Shopify have ready-made reports on its platform. Google Analytics also offer online courses if you want to learn how to analyse your online business.

Step 5: Set up your taxes properly

As a business owner, you need to ensure your business is tax registered.

Sole Traders need to register for Income Tax and Limited Companies need to register for Corporation Tax. This needs to be done before your business starts to invoice clients.

Other taxes you need to consider registering for include: Value Added Tax (VAT) and Pay As You Earn (PAYE). Check out our post on VAT registration in Ireland as well as our payroll outsourcing page for more information.

If your business is applying for VAT, then you should know how to charge VAT. There are different guidelines depending on what you are selling and to whom. So, always seek professional advice before you register for VAT. Check out our post on VAT on services in Ireland for more information. We also recommend reading our guide on how to start a small business in Ireland.

Speak to our Client Services Team if you are considering starting an online business in Ireland. Our team can advise the best services to help you get your business started.

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Step 6: Know what expenses you can claim

Claiming business expenses reduces the amount of tax you pay at the end of the year.

The expenses you claim must be wholly and exclusively for the purpose of the business so its important you know which expenses qualify. For example, there are a number of expenses you can claim if you are working from a home office. Check our post on claiming home office expenses for more information.

You should ensure that you are keeping track of all your expenses so you don’t overpay on your tax bill. Using online accounting software will greatly help you reduce the administration time of recording and maintaining business records.

We offer a free Premium subscription to Xero accounting software for all our accountancy clients. Get in touch with our Client Services Team to discuss outsourcing your accounting.

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Ready to set up your online business?

If you’re ready to take the next step to set up your online business, get in touch with our Client Sevices Team. We can talk you through what you need to do to register with the appropriate authorities.

Ensure you get set up correctly with our Company Formation Service.

We take care of everything you need so you have time to focus on getting your website, suppliers, and analytics in order for our online business.

If you have queries about how an online business operates, let us know how we can help you.

Call us on +353 (1) 905 9364 or email hello@accountantonline.ie.

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