New business' 2009 - 3yr tax free exemption

J

Jackie D

Registered User
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Hi

Can somebody please explain the 3year tax free exemption for new business' set up in 2009?

What defines being set up? If you register as a LTD company in 2009 and have expenses such as travel, website, stationary etc but no direct sales, is this considered as being set up?

Also, if say you set up a LTD company in 2009 which is slightly different to what you sole trade as. . .would this qualify?
Example: Currently sole trading as a "clothing supplier".. New name/New LTD company trading for new 2009 rule, "renting clothes".. Would this qualify?
I understand these could be viewed as being similar but the business concept would be totally different..

Where could I get this clarified?

Thanks in advance
 
Hi Jackie D. In order to qualify:

the limited company must have been incorporated after 14th October 2008;
the limited company must commence to trade in 2009;
the trade must be a new trade.

In the event of an audit, you must be able to satisfy the Revenue that the business activity of the limited company is different to the trade carried on under your sole trade.

You must have started making sales in order to be considered to have started trading.
 
the trade must be a new trade.
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As in a totally new trade/innovation in Ireland or a new trade for person in business ie - a Florist if that person had no previous experience being a Florist.

I think they are still awaiting EU approval for this exemption
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They are yes.

I read that they hope to introduce a similar scheme for sole traders.

Thanks!
 
I would be stunned beyond belief to see a similar scheme for sole traders. We are about to get shafted in the upcoming December budget so I can't see any potential future tax income being given away.

In fact there is no guarantee that the limited company scheme will be continued into 2010.

With regard to your query on the new trade aspect, my understanding is that it relates to a business which was not previously trading - this caveat was brought in to stop sole traders merely converting to limited company in order to avoid tax.
 
I can't see how the EU could approve this scheme, as it puts existing companies at an immediate disadvantage to their new competitors.
 
papervalue said:
I think they are still awaiting EU approval for this exemption
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Maybe I've got this wrong but here we are with two months to go in '09 to commence trade and this scheme is not yet approved? So the EU could just as easily say - Non? Surely that is stunting its effectiveness?

I can see it now.. "Ah, now, eh, yeah, sorry lads, I know ye all when out and formed all those businesses and spent all that money but you know the tax exemption I told ye about, well the thing is ........" (For best effect use B. Cowen's or Fr. Dougle's voice)

Please correct me if I'm wrong.;)
 
I understand that this scheme is dead in the water...it will remain subject to Ministerial Order forever. And anyway, new businesses or trades making taxable trading profits of up to €320,000 (or €480,000) in their first year are surely thin on the ground.
 
Can anyone please advise if this is still running? Also, if I was a director is an umbrella company and want to start my own company will I qualify?
Thanks
F
 
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