How to set up a Limited Company

When you start your business and form a Limited Company in Ireland you need to guarantee you meet all the legal requirements. Our checklist will help you avoid mistakes. This is an exciting time for you so let’s get it right from the beginning.

If you rather not go through the process on your own, talk to our Client Services Team about outsourcing company formation We’re always happy to help.

We through the steps to set up an Irish Limited Company below…

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Firstly, what is a Limited Company?

A Limited Company (LTD) is sometimes called ‘A Private Company Limited by Shares’. It is the most common type of structure in Ireland.

A Limited Company has limited liability and share capital. It can have a single Director and single shareholder. Most small Limited Companies are audit exempt, which means your financial statements don’t need to be audited.

Limited Companies have certain compliance requirements when setting up and when managing the company. So it’s important you’re aware of these to avoid fines and penalties.

If you’re unsure whether you should set up as a Sole Trader or Limited Company, contact our expert Client Services Team. We are always happy to talk you through the different business structures in Ireland.

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

What do you need to set up a new company in Ireland?

This is a checklist to make sure you know everything that’s involved with setting up an Irish Limited Company.

If you questions you would like answered by our professional Client Services Team, contact us now and we are happy to help.

  • Director, Company Secretary and Shareholders
  • Share/ownership structure
  • Registered office and business address
  • Company name & documentation
  • Company seal
  • Bank application and tax registration

1. Have at least one Director

Appoint a Director – you need at least one. The Director is responsible for managing the company on behalf of its shareholders. In small companies, the Directors and shareholders are often the same people.

All Irish companies are required to have at least one Director who is a resident of an EEA country. If all the Directors of your company are based outside of the EEA, then you must purchase a non-EEA residents bond before setting up your company.

For example, if you have one Director who is resident in Ireland and one Director who is resident in USA, you can set up a company without purchasing a bond.

If the only two Directors are resident in USA, you have to purchase a bond before starting a company in Ireland.

Check out what else you should know as a Director of an Irish Limited Company.

It’s also good to note that the shareholders can be resident anywhere.

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2. Choose a Company Secretary

If you only have one Director, you need to find a separate Company Secretary. If you have two or more, one of them can also act as the Company Secretary. You can outsource your Company Secretary to a corporate body, such as our professional team here in Accountant Online.

The main duty of the Company Secretary is to file Annual Returns each year. They work with your Accountant to ensure that your financial statements are filed on time. Late filings will incur fines up to €1,200 and your financial statements may need to be audited for two years. For peace of mind that your Annual Returns won’t be missed, find out more about our Company Secretarial service.

3. Have at least one Shareholder

The shareholders are the owners of your company. It is very common in Startups for the Director and/or Company Secretary to be the shareholders of the company.

If you are setting up a company with a co-founder, you may have questions about shareholders agreements and voting rights. Feel free to talk to us if you would like more information about how to set up an Irish Limited Company.

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4. Decide how many shares you want to release

What are shares?

Think of shares as pieces of the company you can give away. Therefore, this division of shares determines the legal ownership of the company. You issue shares when you’re setting up a Limited Company and you can also issue more or transfer shares once the company has been set up.

You can also have different types of shares with different voting rights but this is usually done after the company is set up. To do this, it requires more work than an average company set up as it is more complicated.

Talk to us if you have any questions about setting up a company – we’re happy to help.

Types of shares required when setting up a company

  1. Authorised shares. These are like an aspirational amount of shares that you can issue, now or in the future. Authorised shares have no monetary value and do not affect the value of the company.
  2. Issued shares. These are the number of shares that have actually been allocated and paid for by shareholders. If you issue 100 shares to one shareholder then that shareholder will have 100% ownership of the company. The number of shares that you issue determines who owns the Irish Limited Company.

We recommend having 100,000 authorised shares and issuing 100 shares of €1 in value. But don’t worry if you’re not sure about the share structure. We have a team of Company Secretarial professionals who help you each step of the way.

5. Have a Registered Office Address and Business Address

Both of these addresses are required when registering a company with the CRO. The Registered Office Address is the official, legal address of your company. It must be a physical address located in Ireland and monitored regularly. Our Registered Address Service ensures your company complies with these laws. It is common for this address to be with your Accountant because important notices get sent here.

The Business Address is where your company is actually trading. If you’re running an online business or working from home, you may want to look into a Business Correspondence Address for your company. Our mail-forwarding service allows you to use our Dublin 3 for your business correspondence.

We also offer a Virtual Office service where you get both address services at a discounted price. If you need help determining what services you need to start a company in Ireland, contact our Client Services Team today on +353 (1) 905 9364 or email hello@accountantonline.ie.

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6. Decide on a company name

When you want to set up a Limited Company, the company name is probably the first thing you think of. Your company name must be unique and distinguishable against other names already registered with the CRO. The Registrar will carry out name checks and if your proposed name isn’t strong, your company submission will be returned. We do this all the time and have lots of experience to help you make the right choice.

If you are feeling uninspired about what name to choose, check out our top tips for choosing your company name. Your proposed name must meet company name guidelines. You can check if anyone else has used your proposed name via the CRO’s Company Search Facility or search the trademark register.

It is easier and less time consuming to outsource company registration to a company formation specialist, such as our team here in Accountant Online. Company name check is included in our new Company Registration package, so just tell us your proposed company name and we will do the rest!

7. Prepare and sign the incorporation documents

Once you have met the requirements above, you are now ready to incorporate your company. There are 2 options:

  1. You can incorporate your company online via Companies Online Registration Environment (CORE).
  2. Or have a company formation specialist such as Accountant Online to do this for you.

Setting up a Limited Company with Accountant Online offers a simple, stress-free option for Irish Company Formation. Gather up all your details as above to be able to complete the form.

All you need to do is sign the forms (Form A1 and Constitution) and post them back to our Dublin office. We can have your company formed in less than one week.

Find out what services you need to set up a new company in Ireland by getting in touch with our Client Services Team. Call +353 (0)1 905 9364 or email hello@accountantonline.ie.

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8. Order your company seal

So your company is now incorporated and your company name has been approved. You will now need to purchase a company seal. It must have the company’s name engraved on it. It should be used to seal certain documents. Examples of such documents include the transfers of shares and certain documents provided in the articles, company law, contract law, and property law.

You can purchase your company seal while you register your company and you’ll have it as soon as it’s set up.

9. Set up a business bank account in Ireland

Once your company is set up, it’s best practice to keep business income separate from personal income. To open a business bank account in Ireland you usually need to have at least one meeting face-to-face. You will also need company documents – including the original certificate of incorporation, your company constitution and a copy of the A1 form – which Accountant Online draws up for you when you form your company with us.

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10. Register for tax

New companies in Ireland need to complete tax registration before you start trading. This means before you invoice your clients, you need to be registered for tax with Revenue.

It is a separate process to registering your company with the CRO and this process is usually done by an accountant.

Talk to us about our Startup Offer for new companies – it includes tax applications and perfect for new companies in Ireland.

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Corporation Tax

All companies in Ireland need to pay Corporation Tax, no matter how large or small. To qualify for 12.5% Corporation Tax, you need to prove that you’re actively trading and centrally managed in Ireland.

Even if you don’t qualify for 12.5% Corporation Tax, you still need to register with Revenue for tax and you are subject to Corporation Tax at 25%.

Relevant Contracts Tax (RCT)

You need to pay RCT if you are a principal contractor. This is someone who pays a subcontractor to carry out activities on behalf of your business. This applies to subcontractors in these ‘relevant’ industries: construction, forestry, and meat processing.

Employers PAYE

If you plan to employ people, you will have to register as an employer and operate a payroll system in Ireland. You are responsible for deducting the appropriate PAYE tax, USC, and PRSI from your employee’s wages on or before they are paid.

11. File the Beneficial Owner with the Register Of Beneficial Owners (RBO)

All Irish registered companies are required to register their Beneficial Owner (anyone holding 25% or more of company shares) on the RBO website. This needs to be done within 5 months after your company has been incorporated.

To complete the registration, you need to have a PPSN or prepare and sign a BEN2 form, which then needs to be notarised (signed and stamped) by a public notary and uploaded to the RBO website.

If you don’t complete the RBO registration, it is considered a criminal offence and this can result in the imposition of a fine or even conviction.

12. File Annual Returns with the CRO

When you incorporate your company, you need to file Annual Returns with the CRO, even if you are not trading.  Each company has an Annual Return Date allocated to it. It can be checked using the CRO Company Search facility.

Your first Annual Return (a B1 form) is due 6 months after incorporation. It is important to note that you have 28 days from your ARD to file your annual return. Your accountant and Company Secretary will advise you on this. The first Annual Return includes details about your company.

You can outsource this to a Company Secretarial service, such as Accountant Online. We also offer this as part of our Startup Offer for new Limited Companies.

Your second Annual Return is due 12 months after your 1st Annual Return. Your accountant will now need to prepare a balance sheet, profit and loss account, directors’ report and sometimes, an auditor’s report every year. Subsequent annual returns and financial statements are then filed on this date every year.

Do you have questions about your accounting obligations as a Limited Company in Ireland? Our team of Client Services members is happy to talk you through the deadlines for new companies. Call us on +353 (1) 905 9364 or email hello@accountantonline.ie.

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Be aware of the late filing deadlines

If you are late filing your first B1 form, your company will be fined €100 and then €3 per day after that. This penalty is up to a max €1200 per year. If you are late filing any subsequent B1 forms, you will have to pay the fine and your accounts will be audited for 2 years.

These deadlines are important and it may be worthwhile to have a professional look after it for you. Your annual returns are looked after for you as part of our company secretary service and Startup Offer. Please note that you may need an accountant to look after your financial statements.

13. File a Director’s income tax return (form 11) before 31st October

A company director is obliged to file a self-assessed income tax return every year. In the same way that a sole trader is self-assessed. A non-proprietary director (someone who owns less than 15% of the shares in the company) must submit a form 12 tax return. As a client of Accountant Online, we can also file your Director’s Return.

Ready to set up a new Limited Company in Ireland?

If you’ve gotten this far in our checklist and you still have questions, get in touch with us. We are happy to help.

Setting up an Irish Limited Company doesn’t have to be a difficult task. With the right support and resources, we hope getting your Startup off the ground is a fun and exciting process. Our team of professionals are here to help you each step of the way.

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

We’re also available via Whatsapp +353 89 442 8091 and live chat online.

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