0% Corporation Tax for start-up companies

[Brendan Burgess]

Any good summary of this available online?

It might well swing the decision in favour of a company vs. a soletrader structure.

Should a contractor cease to trade through his existing company and set up a new company?

 

[papervalue]

Any good summary of this available online?

It might well swing the decision in favour of a company vs. a soletrader structure.

Should a contractor cease to trade through his existing company and set up a new company?

per tax website


per accounants website

http://www.charteredaccountants.ie/...f-for-Start-Up-Companies---SI-No-516-of-2009/


finance act section below
http://www.irishstatutebook.ie/2008/en/act/pub/0025/sec0031.html#sec31

 

[DB74]

Should a contractor cease to trade through his existing company and set up a new company?

My understanding is that it must be an entirely new trade/business and the transfer of a business from a sole trader to a limited company WILL NOT qualify for the exemption.

 

[bullworth]

My understanding is that it must be an entirely new trade/business and the transfer of a business from a sole trader to a limited company WILL NOT qualify for the exemption.

Does this mean someone could enter your business area as a competitor and drive you out of business due to them paying no tax while you pay full tax ?

 

[DB74]

Yes, basically

 

[patftrears]

Does this mean someone could enter your business area as a competitor and drive you out of business due to them paying no tax while you pay full tax ?

It's for start-up companies and only those in specific sectors.

It will take a while for a start-up company to gain traction and start actually paying corporation tax. So it is not really a competitive advantage.

 

[Sconhome]

Surely if you have a profit making company you can invest profits in the setting up of a new group format company which would allow massive competitive advantages to already established business through tax savings

Am sure it is quite simplistic a statement but no doubt repetitively simple in operation with clever company structuring.

 

[John Conlon]

DB74 is correct. An existing trade does not qualify

Also, a few other things to consider.
You pay 0% Corporation Tax. But if you extract cash you still pay Income Tax up to your highest personal rate.

Most valuable if you are generating more cash than you take out. [broken link removed]