How to Set Up as a Sole Trader

If you’ve always dreamed of owning and running your own business, you have a number of options available to you including setting up as a limited company or registering as a sole trader. In this article, we focus on how to set up as a sole trader in Ireland. A sole trader is the simplest legal structure for a business in Ireland and it also has a very straight forward registration process.

To register as a sole trader in Ireland, you will need to take the following steps:

1. Register for Income Tax by completing Form TR1

The first thing you need to do is complete a Form TR1 and submit it to your local tax office. Basically, a Form TR1 allows you to register for taxes, including Income Tax, VAT and Employers PAYE. As a sole trader, you will need to file an income tax return and pay your liabilities before 31 October each year.
Simply put, income tax is a tax on the profit made by your business. But it’s important to remember that even if you made a loss or your business had minimal trading, you must submit an income tax.

2. Register for VAT (if applicable)
In general, if your business supplies goods over €75,000 per year or services over €37,500, you are obliged to register for VAT. But there are a number of exceptions such as taxis and crèches who do not charge VAT.

VAT returns contain details of the VAT on your sales and the VAT on your purchases as well as details of goods bought from and sold to other EU countries. If you have more sales than purchases, then you will pay the difference to Revenue.

If you have no experience in VAT, it can become a little overwhelming. If you are running a restaurant, making purchases or supplies to other countries, are involved in e-commerce or are unsure about what VAT rate to charge, it may be best to seek professional advice.

Also, an annual VAT Return of Trading Details return must be filed each year.

3. Register for Employers PAYE (if applicable)

If you are going to have employees, you will have to register as an employer. You will be responsible for deducting the appropriate PAYE tax, Universal Social Charge and PRSI from your employees’ wages as well as filing regular returns throughout the year.

Every time you want to pay your employees, you need to first send a payroll file to Revenue with details of their salaries and taxes. Revenue will send you a monthly statement of how much payroll taxes you owe them based on these uploaded files. Payments to Revenue are made every month or every quarter depending on the size of the business.

Operating payroll for your business can be time consuming and confusing. You will need to invest in some payroll software to make things easier. But if you have no experience in processing payroll, we advise you to attend a payroll course or hire a professional to process your payroll – it can prevent a lot of costly mistakes in the long run.

4. Register for ROS on

Don’t forget, businesses are now required to register for ROS and must complete their returns online. The Revenue Online Service (ROS) allows you to file and pay your income tax, VAT and Employers PAYE returns securely online. There are a lot of advantages to using ROS such as extended deadlines and instantaneous notification of receipt of returns.

5. Register Your Business Name

If you trade under a business name, you will also need to register this business name with the CRO. You can do this online at by registering as a user and filling out the business name registration form. This is in addition to filing Form TR1 to register for taxes.

If you are thinking of setting up your dream business or have any questions about getting things started, please call us today on 021 240 9120.

Updated 26/03/19 for PAYE Modernisation

6 thoughts on “How to Set Up as a Sole Trader

  1. Irene Wall Reply

    Morning applying for a job on etender do I have to have set up a company to apply?

    • Orla Linehan Post authorReply

      Sole traders can register as suppliers on the etenders website.

      You will also need to check the particular requirements of the work you are tendering for.

      All the best,


  2. Bart Reply

    Hi, I received my certificate from CRO, then registered for Income Tax on Revenue online. After 3 days I was allowed to register to ROS which I did. For now, I have my RB Cert for Business, I have added Income Tax on Revenue Online and I register to ROS. What else should I do? How to add incomes and outcomes? Should I do anything else? I work full time for one company and additionally, I provide consultancy services.

    • Orla Linehan Post authorReply

      Hi Bart,

      Thanks for your comment.

      It would be a good idea to make an appointment with a local accountant, who can guide you through the next steps and help you set up a good bookkeeping system. In my experience, it is better to get everything set up properly from the start, rather than waiting until your tax return needs to be done before hiring an accountant.

      All the best,


  3. Sami Reply

    Hi Orla

    What is TCSPs ? for instance, if you help someone to form a company in Ireland and charged a consultancy fee ? Do you need to have TCSPs authorisation ?

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