CompleteNewbie
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Thank you so much, and your advice seems very grounded. Much appreciated.It's actually pretty straightforward once you sit down & go through the bits. Brendan has laid out most of it, if not all!
The bank account is important as it separates the business from personal.
When I started nearly 20 years ago, on opening the business account in the bank, it gave me a free meeting with an accountant, and in that meeting they laid it all out in terms of what I should be doing. I'm still with those accountants...so a good accountant is worth the grand or so it will cost each year.
You can use Quickbooks or Sage if you want to help with accounts, and I did for a while, but my accountant was always happy with a simple record book with two columns, money in, money out! I was organised so all was pretty easy for them, still is! When it came to it after 2 years in business, I had to deal with VAT, my accountants laid it out, how to do it, and I did that myself bi-monthly.
Thank you so much Brendan. The 1st January advice is very sound. Take care.You can prepare annual accounts up to any date you like. For example, if you started on 1 September, you can prepare accounts for 12 months to 31 August.
My suggestion is that life is a lot simpler if you prepare accounts up to 31 December. (Unless it's a seasonal business like retail, where you might want to prepare accounts to the end of January and the sales are completed.)
When you are up and running , you will be taxed as follows - assuming you are making a profit.
For the year 2026, you will have to pay Preliminary Tax for the year by the end of October. So you estimate your profits and pay the Income Tax accordingly. All you do at that stage is send in the payment. Then by the end of October 2027, you must make a tax return for the year 2026, work out the exact tax and pay any balance that is due.
I don't know what happens in a new business.
For example, if you set up on 1 September 2024 and you make a profit in the 4 months to 31 December 2024, do you have to make a payment by the end of October anticipating your profits for the year?
There are all sorts of complex rules if you set up on 1 Sept and prepare accounts to some date other than 31 December. If you are not making huge profits or losses, then just make your accounts up to the 31 December. If you are making big profits or losses, there may be tax planning opportunities, and you would need to sit down with an accountant.
As I have already said, Revenue is not the demon which it is often portrayed as, and understands small businesses.
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