In the times that we live in more people are taking the opportunity to establish their own business whether it be due to redundancy or just wanting to take the plunge and become self employed. When you land your all-important first contract it's vital that the conditions of the contract distinguish you from being self-employed rather than that of an employee. The category that a worker falls into depends on what they actually do, the way they do it and the terms and conditions under which they are engaged, whether written, verbal or implied.
Employers in Ireland are responsible for ensuring all their employees receive certain basic employment rights. These rights are governed by a range of detailed employment legislation. In some industries employees are entitled to additional rights. The role of the National Employment Rights Authority (NERA) Information Services is to provide free, unbiased information on employment rights in Ireland to employers, employees and other interested parties.
Firstly, please bear in mind that the decision to form a company should not be taken lightly. While the company will be a separate legal entity and it’s shareholders have limited liability, it still requires that at least two directors be appointed as well as a company secretary. The responsibilities of a company director are quite onerous and you should be fully aware of what they are. Failure to comply fully with filing regulations may result in financial penalties, disqualification from acting as a director or management of a company and strike-off of the company from the register of companies. This is something you do not want to happen as re-instatement could be quite a time consuming and costly affair which you want to avoid at all costs.
If you are going to act as a director or company secretary then the one site which you are going to have to bookmark in your favourites list is that of the Companies Registration Office or CRO www.cro.ie . You will be spending a lot of time visiting this site in future years!
At last count the CRO had published about 25 Information Leaflets on everything from Company Incorporation to The Company Secretary to Business Name Registration to Filing an Annual Return. I would very much recommend printing out these leaflets and creating a file where you can browse through at your leisure any area which is going to be of relevance to your company and future filing requirements.
The Minister for Justice, Equality and Law Reform, Mr. Dermot Ahern, T.D., has announced that he has introduced new Court Rules to extend the current remit of the Small Claims procedure to include certain business claims. The new rules will facilitate claims from a business against another business in respect of goods or services not exceeding €2,000.
As a new entrepreneur (hopefully with a well thought out business plan!) one of the first major decisions you have to make, preferably before you start trading, is what legal form to take. Typically, the choices available are to trade as a sole trader, a limited liability company or a partnership. Each has its own distinct advantages and disadvantages and the merits of each legal form need to be considered carefully.
It is recommended that you take the appropriate advice now from either an accountant, tax adviser or small business consultant in order to thoroughly discuss the right legal form which your business should take and which is advisable for your circumstances.
One useful publication which gives a good outline of these various legal forms as well as providing details of what is required in respect of each is A Practical Guide to Starting your own Business which has been published by AIB. This guide considers and provides information on all aspects of starting a new business including a business plan template, legal, insurance, and financial considerations. Click here to download from the AIB website.