Starting a business in Ireland is less complicated than many people fear, but it does require getting a set of things done in the right order. This is one of several guides in our business startup library covering everything from structure to funding to tax. The mistakes I see most often as an accountant are not strategic failures — they are administrative ones. Someone starts trading, builds up clients, earns real money, and then realises six months later that they’ve been operating without registering for tax, or that they should have registered for VAT from month two, or that they’ve been operating as a sole trader when a limited company would have saved them a significant amount.
This guide is designed to prevent those mistakes. It covers the full sequence of what you need to do when starting a business in Ireland in 2026 — from the first week to the end of your first year.
Step 1: Decide on Your Business Structure
The first decision is whether to operate as a sole trader or set up a limited company. I’ve written a detailed guide to this decision separately, so I won’t repeat the full analysis here. The short version:
If you are starting out and expect profits under €80,000–€100,000 in the early years, starting as a sole trader is simpler and cheaper to operate. The tax difference at lower profit levels does not justify the compliance overhead of a company. You can always incorporate later.
If you already have a professional background, are entering a sector where limited liability is important, or expect to grow quickly and retain profits in the business, incorporating from the start may make sense.
Make this decision with advice. The structure you start with is not irreversible, but changing it later has costs and complexity.
Step 2: Register Your Business Name
If you are trading as a sole trader under a name other than your own full legal name, you must register that business name with the CRO under the Registration of Business Names Act 1963. This is a simple and inexpensive registration — done through the CRO website at core.cro.ie.
If you are setting up a limited company, the company name is registered as part of the company incorporation process.
Before registering any name, check:
The CRO database to confirm the name is not already registered. The Trademark Register (ipoi.gov.ie) to ensure you are not infringing an existing trademark. Domain name availability — your business name should have a matching .ie or .com domain available.
Step 3: Register With Revenue
This is the most important administrative step. Before you start trading, you should register with Revenue as a self-employed individual (if a sole trader) or register your company for corporation tax (if a limited company).
Registration is done through Revenue’s MyAccount or ROS (Revenue Online Service) systems.
As a sole trader, you will register for Income Tax. Once registered, you will receive your Tax Registration Number and can access ROS to file returns and manage your tax affairs online.
As a limited company, the company registers separately for Corporation Tax. The company’s directors will also need their own personal Revenue registrations for any salary they draw.
If you intend to employ staff from day one, you also need to register as an employer with Revenue and set up PAYE. This can be done at the same time as the main tax registration.
Step 4: Open a Business Bank Account
Open a dedicated business bank account before you start receiving income. Mixing personal and business finances is one of the most common mistakes new business owners make, and it creates a significant accounting headache at year end.
Your options in Ireland include the main banks (Bank of Ireland, AIB, PTSB), credit unions (which can offer good-value current accounts for small businesses), and the newer digital banks (Revolut Business, Wise Business) which have gained traction particularly for businesses with cross-border transactions or lower transaction volumes.
You will typically need:
Proof of identity (passport or driving licence). Proof of address (utility bill, bank statement). Your business registration documents (CRO registration or Revenue registration). In some cases, a business plan or explanation of the business activity.
Step 5: Decide on VAT Registration
The VAT registration thresholds in 2026 are €80,000 for goods-supplying businesses and €40,000 for service businesses. You must register when your turnover reaches or is expected to reach these thresholds.
However, there are circumstances where voluntary VAT registration before reaching the threshold makes sense:
If your customers are VAT-registered businesses (who can reclaim the VAT you charge), adding VAT to your invoices does not make you more expensive to them. You can then reclaim VAT on all your business purchases — materials, equipment, professional fees, fuel — which can be a significant saving in the early months when you are investing in your business.
If your customers are consumers or small businesses not registered for VAT, adding 23% to your prices makes you more expensive. In this case, staying below the threshold for as long as legitimate is often the right approach.
Discuss VAT registration timing with your accountant early. The decision has cash flow implications in both directions.
Step 6: Set Up Record-Keeping From Day One
The biggest favour you can do your future self is to set up a proper record-keeping system before you issue your first invoice. Trying to reconstruct a year’s financial records from a shoebox of receipts at tax return time is time-consuming, expensive, and error-prone — and it is one of the most common first-year financial mistakes I see new business owners make.
At a minimum, you need to track:
All sales invoices issued, with dates, amounts, and customer details. All purchase receipts, with dates, amounts, and supplier details. Bank statements reconciled to your records monthly.
For most small businesses, a simple cloud accounting package — Xero, QuickBooks, Surf Accounts, or even a well-maintained spreadsheet for very simple businesses — is sufficient. The investment in setting this up properly at the start pays back many times over.
Step 7: Understand Your Preliminary Tax Obligation
One of the things that catches new sole traders off guard is preliminary tax. In Ireland, income tax is paid on a current-year basis, meaning you are expected to pay tax on the income you are earning now, not just at the end of the year.
The system works as follows: by 31 October each year, you must pay preliminary tax for the current year (at least 90% of the current year liability, or 100% of the prior year liability) and also file and pay your income tax return for the previous year.
In your first year of trading, you may not have any prior year liability — but you still need to estimate what the current year liability will be and pay preliminary tax accordingly. If you significantly underpay, you face interest charges when the final return is filed.
Planning for preliminary tax is one of the most valuable things an accountant can help a new business owner with. I typically recommend setting aside a proportion of income each month — into a separate savings account if possible — specifically for tax. The proportion depends on your income level and tax situation, but as a rough guide for a sole trader on typical trading profits, setting aside 25–30% of net income for tax is a reasonable starting point.
Step 8: Payroll — If You Have Employees
If you are employing anyone from day one — even a part-time assistant or a family member helping in the business — you need to register as an employer with Revenue and set up PAYE.
Under PAYE Modernisation (live in Ireland since 2019), payroll data must be submitted to Revenue on or before each pay date in real time. This means you cannot simply pay someone and settle the tax at year end. You need a payroll system — even a very simple one — that calculates PAYE, PRSI, and USC correctly and submits the data to Revenue each time you run payroll.
Under the new auto-enrolment pension rules (live from September 2025), employees aged 23–60 earning more than €20,000 must be automatically enrolled into the pension scheme unless they are already in a qualifying occupational pension. This has payroll cost implications from your first employee.
Step 9: Your First Tax Return
If you started trading in 2025, your first income tax return (Form 11) covering that trading period is due by 31 October 2026 (or mid-November if you file via ROS). This return covers all your income for the 2025 tax year — employment income if you had a job before going self-employed, any investment income, and your new business trading income.
The business portion of the return declares your turnover, your allowable expenses, and your net taxable profit. This is where the quality of your record-keeping pays off — every receipt and expense properly recorded reduces your taxable profit and therefore your tax bill.
Step 10: Talk to an Accountant Early
I say this not for the obvious reason, but for the less obvious one. The value of an accountant to a new business is not primarily the year-end accounts — it is the decisions made in the first six months that set the tax and compliance framework for years. The right structure. The right VAT registration approach. The right payroll setup. The right approach to extracting income from the business. These decisions, made well at the start, are worth far more than their cost.
Before you get too deep into trading, it is also worth checking what grants are available for new businesses in County Louth — there is meaningful public funding that goes unclaimed every year. If you are starting or recently started a business in Dundalk or County Louth and you want to make sure you’re set up correctly from the beginning, my door is open.
Paddy Malone FCA AITI
Paddy is the principal of Malone & Co. Chartered Accountants in Dundalk. A Fellow of Chartered Accountants Ireland and a Chartered Tax Consultant with the Irish Tax Institute, he has been advising businesses across County Louth and the North-East for over 35 years.