Irish Business Setup - Last updated April 2026

How to Start a Business in Ireland - 2026 Step-by-Step Guide

Five steps take an Irish business from idea to trading: choose a structure, register with the Companies Registration Office, register for tax with Revenue, open a business bank account, and set up a compliant software stack. This guide is written for 2026 - with current VAT thresholds, CRO fees, and the software Irish SMEs actually use.

Sole trader vs limited company - which structure is right?

The structure you choose sets your tax rate, your personal liability, and how much paperwork you carry for the life of the business.

Tax treatment

Sole traders pay income tax on trading profit at 20% up to €44,000 (single earner, 2025 band) and 40% above, plus PRSI (4%) and USC. Irish limited companies pay corporation tax at 12.5% on trading income and 25% on non-trading (passive) income. Once profits sit comfortably above the 40% income tax threshold, the company becomes materially cheaper to run for retained earnings.

Personal liability

A sole trader is the business. Business debts are personal debts, and personal assets can be pursued by creditors. A limited company is a separate legal person - shareholders are liable only up to their unpaid share capital. If the activity carries real commercial, contractual, or professional risk, the Ltd shield matters.

CRO filings and admin

Sole traders file no accounts with the Companies Registration Office unless they use a business name (Form RBN1, €20 online). Limited companies file an annual return (Form B1) and statutory accounts to the CRO every year, plus a Register of Beneficial Owners (RBO) filing. Late CRO filings attract penalties and can strip audit exemption.

Accounting complexity

Sole trader accounts can often be handled in a single cloud tool such as Surf Accounts or Xero, with an accountant reviewing a Form 11 once a year. Ltd companies need statutory accounts under FRS 102 or FRS 105, corporation tax computations (CT1), and usually monthly management accounts - expect accountant fees from €1,200 to €3,000+ per year.

Ideal use cases

Sole trader suits freelancers, consultants, tradespeople, and side businesses with profits under roughly €40,000. Limited company suits growing businesses with employees, higher profits, VAT-registered B2B trade, external investment plans, or activities with real liability (construction, regulated services, professional practice).

Switching later

It is common to start as a sole trader and incorporate once profits justify it. Revenue allows the transfer of a sole trade into a new limited company under Section 600 TCA 1997 relief, which defers capital gains tax on the transfer of business assets in exchange for shares. Plan the timing with your accountant - mid-year changes trigger two tax returns.

5 steps to register your Irish business

The order matters - tax registration depends on company number, and bank accounts depend on both.

  1. 1

    Step 1 - Choose your business structure

    Decide between sole trader, partnership, or private company limited by shares (LTD). Sole trader suits low-risk, low-admin starts. LTD suits higher profits, employees, or real liability. Partnerships suit two or more co-owners with a formal partnership agreement. Unlimited companies and designated activity companies (DACs) exist but are specialist - almost every new Irish SME chooses sole trader or LTD.

  2. 2

    Step 2 - Register with the Companies Registration Office (CRO)

    For an LTD, file Form A1 online via CORE (core.cro.ie) - €50 online, €100 on paper. You need a company name (checked on the CRO register), at least one director resident in the EEA (or a Section 137 bond), a company secretary, a registered office in Ireland, and a constitution. Approval typically takes 5 to 10 working days. Sole traders trading under a business name file Form RBN1 (€20 online). After incorporation, every Irish company must also file a Register of Beneficial Owners (RBO) return within five months.

  3. 3

    Step 3 - Register with Revenue for tax

    Sole traders register for income tax, PRSI, and (if applicable) VAT using Form TR1 via ROS. Companies register for corporation tax, VAT, and PAYE/PRSI using Form TR2. VAT registration is mandatory once turnover is expected to exceed €85,000 for goods or €42,500 for services in any 12-month period (thresholds increased from 1 January 2025). If you plan to hire, register as an employer on the TR2/TR1 - you cannot run PAYE Modernisation without an employer registration number.

  4. 4

    Step 4 - Open a business bank account

    Revolut Business is the fastest route for most new Irish SMEs - online onboarding in days, a free Basic tier with an Irish IBAN issued through the Revolut Bank UAB Irish branch, SEPA Instant, and native bank feeds to Xero, QuickBooks and Sage. AIB and Bank of Ireland remain the default for businesses needing branch banking, cash lodgements, or overdrafts, but expect 2 to 6 weeks for KYC. See our full ranking on the Irish business banking comparison.

  5. 5

    Step 5 - Set up your software stack

    At a minimum: accounting software with Revenue ROS integration (Surf Accounts or Xero), payroll software with PAYE Modernisation if you hire (BrightPay is the Irish default), invoicing with Irish VAT rates, and a free-tier CRM (HubSpot CRM) to track leads. Productivity follows from there - Google Workspace or Microsoft 365. Set this up before your first invoice goes out so that every transaction is captured cleanly from day one.

Verified from Vendors.ie vendor data, April 2026

First software stack for new Irish businesses

The six tools most Irish SMEs need in their first 90 days. Each recommendation is drawn from vendor data with confirmed Irish compliance attributes - Revenue ROS, PAYE Modernisation, Irish IBAN support, EU data residency - rather than generic reviews.

Revolut Business - banking

First-choice business bank for most Irish SMEs launching in 2026. Irish IBAN via the Revolut Bank UAB Irish branch, free Basic tier, SEPA Instant, and native feeds to Xero, QuickBooks, and Sage. Deposit protection is Lithuanian (€100,000). See business banking comparison.

Surf Accounts or Xero - accounting

Surf Accounts is Irish-built with Revenue integration, AIB and BOI bank feeds, and Dublin-based support from €29/month. Xero is the international default with the largest app ecosystem and strong Irish VAT and bank-feed coverage. Both pair cleanly with BrightPay for payroll.

BrightPay - payroll (if hiring)

Irish-built payroll with full PAYE Modernisation, RPN retrieval, ERR reporting, and confirmed Auto-Enrolment (AERSS) readiness since the scheme went live on 1 January 2026. From €229/year. The default Irish payroll recommendation for 1-50 employee businesses.

HubSpot CRM - free tier

Free CRM with contact, deal, and pipeline management. EU data residency available on paid tiers. Strong fit for Irish B2B service businesses needing a sales pipeline from day one without a per-seat spend. Upgrade to Sales Hub only when the free tier limits bite.

Google Workspace or Microsoft 365 - productivity

Business email on your own domain, shared drive, and calendar. Google Workspace Business Starter from €5.75/user/month; Microsoft 365 Business Basic from €6.70/user/month (EU list prices, ex-VAT). Both offer EU data residency options - confirm the configuration when onboarding.

Invoicing tool - free tier

Stripe Invoicing, Zoho Invoice, or Invoice Ninja all offer free or near-free tiers with Irish VAT rates (23%, 13.5%, 9%, 0%). Useful before your accounting software is live, or as a secondary channel for subscription billing. Move invoicing into Xero or Surf Accounts once the accounting stack is set.

For first-time founders and Irish SMEs

Starting a business in Ireland - frequently asked questions

Do I need to register as a sole trader in Ireland?
Yes, if you will trade under any name other than your exact legal name, or once you start earning trading income. Sole traders register for income tax with Revenue using Form TR1 (or TR1(FT) for non-resident individuals) via ROS or myAccount. If you trade under a business name, you also register that name with the Companies Registration Office (CRO) using Form RBN1, which costs €20 online. There is no separate 'sole trader licence' - registration is the combination of Revenue tax registration and, where applicable, a CRO business name filing.
How much does it cost to set up a Ltd company in Ireland?
The Companies Registration Office charges €50 for online incorporation via CORE (Form A1) and €100 on paper. On top of the CRO fee, most founders pay an accountant or formation agent between €200 and €500 for the constitution, company secretary support, registered office, and beneficial ownership (RBO) filing. Budget a further €50 to €100 for a company seal and statutory register if your accountant does not include them. Ongoing costs include annual CRO returns, statutory accounts, corporation tax filing, and - if trading - VAT and payroll compliance.
Do I need a business bank account as a sole trader?
Not legally. A sole trader in Ireland can run trading income through a personal account because the business is not a separate legal entity. In practice, Revenue, your accountant, and any bank feed in accounting software all work more cleanly when business transactions sit in a dedicated account. Revolut Business offers a free Basic tier with an Irish IBAN and native Xero, QuickBooks and Sage integrations, which is why it is the default recommendation for most new Irish sole traders and limited companies.
When do I have to register for VAT in Ireland?
Revenue raised the VAT registration thresholds from 1 January 2025. You must register for VAT once your turnover exceeds €85,000 for the supply of goods or €42,500 for the supply of services over any 12-month period, or when you expect to cross those thresholds. Distance sellers into Ireland register once intra-EU B2C sales exceed €10,000 across all Member States. You can also register voluntarily below the thresholds if your customers are VAT-registered businesses and you want to reclaim input VAT. Registration is done through Revenue's ROS using Form TR1 (sole trader) or TR2 (company).
What is PAYE Modernisation and do I need payroll software from day one?
PAYE Modernisation is Revenue's real-time payroll reporting system, mandatory for every Irish employer since 1 January 2019. You must submit a Payroll Submission Request (PSR) to Revenue on or before each pay date - not at year-end. If you hire even one employee (including yourself as a director drawing a PAYE salary), you need PAYE Modernisation-compliant payroll software or a payroll bureau. BrightPay, Collsoft, and Thesaurus Payroll Manager are the most widely used compliant tools on the Irish market.
Can I start a business in Ireland as a non-EU citizen?
Yes, but the immigration side is separate from the company side. Non-EEA founders incorporating an Irish Ltd typically use the Start-up Entrepreneur Programme (STEP) or the Immigrant Investor Programme, both administered by the Department of Justice. A non-EEA director must either hold a valid Irish residency permission or the company must lodge a Section 137 bond (around €2,000, valid for two years) with the CRO to cover the absence of an EEA-resident director. Tax residency of the company itself is determined by where it is managed and controlled, not by the nationality of its directors.
What Irish government grants are available for new businesses?
Early-stage Irish businesses typically start with their Local Enterprise Office (LEO). LEOs administer Priming Grants and Business Expansion Grants for microenterprises (fewer than 10 employees), plus the Trading Online Voucher, which part-funds a new e-commerce website. Enterprise Ireland supports higher-potential companies with exporting ambition through programmes such as New Frontiers, the Pre-Seed Start Fund, and High Potential Start-Up (HPSU) funding. Revenue operates the Start-Up Refunds for Entrepreneurs (SURE) scheme, which can refund income tax paid in prior PAYE employment for founders investing in a qualifying new company. Amounts and eligibility vary - check LocalEnterprise.ie and Enterprise-Ireland.com for current rates before committing.
How long does it take to set up a business in Ireland?
A sole trader is effectively set up the moment Revenue processes a TR1 - usually within a few working days via ROS. A limited company, incorporated online via CORE using Form A1, is typically approved within 5 to 10 working days, or 1 to 3 working days under the Fé Phráinn priority scheme if your formation agent uses it. Opening a business bank account takes anywhere from a same-day Revolut Business approval to several weeks with AIB or Bank of Ireland, depending on KYC checks. VAT registration at Revenue can add a further 2 to 4 weeks, particularly if Revenue issues a verification questionnaire.
Sole trader or Ltd company - which should I choose?
Choose sole trader if you are testing an idea, expect profits under roughly €40,000, work alone, and want minimum admin. You pay income tax at 20% up to €44,000 and 40% above, plus PRSI and USC, and you are personally liable for all business debts. Choose a limited company once profits exceed the higher-rate income tax band, you want the 12.5% trading corporation tax rate on retained profits, you need to raise investment, or the activity carries real liability. Ltd companies must file annual returns and audited or unaudited statutory accounts to the CRO, which adds accountant fees most sole traders avoid.
Do I need Revenue ROS to run an Irish business?
Yes, in practice. Revenue Online Service (ROS) is the mandatory filing channel for VAT3 returns, corporation tax (CT1), payroll PSRs under PAYE Modernisation, and annual income tax returns (Form 11) for self-employed individuals. You register for ROS at ROS.ie using your PPS number (sole trader) or Tax Reference Number (company). Your accounting software should connect to ROS directly so that VAT returns, payroll filings, and Revenue Payroll Notifications (RPNs) do not require manual re-entry.

Set up the right stack from day one

Compare Irish business banking, Revenue-integrated accounting, and PAYE Modernisation-ready payroll side by side - with verified Irish compliance data.

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