How to Register a Sole Proprietorship (Sole Trader) in Ireland

In Ireland, many freelancers and independent professionals choose to work as sole traders, the simplest way to set up on your own. This structure appeals to contractors, consultants, and small business owners because it’s fast, inexpensive, and keeps administration to a minimum.

Getting started is relatively easy: with just a tax registration and, if needed, a business name filing, you can begin trading almost immediately. There’s no requirement for start-up capital, and digital services from Revenue Commissioners (Ireland’s tax and customs authority) make the process accessible from anywhere.

The main trade-off is that sole traders assume full personal liability for their business obligations, and they’re responsible for filing their own taxes and social insurance contributions. Even so, the independence and flexibility of this route make it one of the most popular ways to launch a business in Ireland.

Disclaimer: This article is for informational purposes only and is not a substitute for legal advice. Please always check official sources or seek professional guidance before taking action.

What is a sole proprietorship in Ireland?

In Ireland, a sole proprietorship is officially called a sole trader. Depending on context, it may also be referred to as:

• Self-employed worker
• Independent contractor

All of these terms describe the same setup, where a single individual runs the business without forming a separate legal entity.

How does a sole proprietorship (sole trader) work in Ireland?

Sole trader vs limited company in Ireland

While the limited company provides a separate legal identity and liability protection, the sole trader route remains simpler and more agile—especially suited for freelancers or small-scale operations.

Step-by-Step guide: How to register a sole proprietorship in Ireland

Step 1: Check your eligibility

To register as a sole trader in Ireland, you must be 18 or older, legally allowed to work, and have a Personal Public Service Number (PPSN).

• EU/EEA citizens: Can set up without restrictions, as long as they’re lawfully resident.
• Non-EEA nationals: Must hold the correct immigration permission (e.g., a Stamp that allows self-employment). Without it, Revenue will not accept your registration.

Step 2: Choose your business name

In Ireland, you may operate under your personal name. If you wish to choose a different name, first check its availability with the CRO, then register using Form RBN1 (paper) or the electronic version via the CRO’s CORE system.

Step 3: Gather required documents

You’ll need:

• Your PPSN
• Business activity description (with NACE code)
• Estimated turnover
• Completed Form TR1 (if not eligible for online registration) or via ROS/myAccount (if you are a PAYE-registered employee)

Step 4: Register with Revenue Commissioners

Most people should register for tax through ROS or via myAccount. Revenue no longer accepts paper applications if you are eligible to register online—so in most cases, you’ll need to complete the process digitally.

Step 5: Pay registration fees and contributions

Tax registration is free. Business name registration costs €20 online or €40 via paper with the CRO. Registration must be done within one month of using the name. Once registered, you must pay preliminary tax by 31 October each year, and file Form 11 to declare income and pay outstanding tax.

Step 6: Complete post-registration obligations

Once registered, you must issue invoices that comply with Irish tax law. Sole traders are required to keep accurate records of all income and expenses, and invoices should include key details such as your name (or registered business name), address, and VAT number if you are VAT-registered.

If VAT applies, you must follow the invoicing rules set by Revenue, including displaying your VAT number and applying the correct rate. Ireland does not yet have a mandatory e-invoicing system for all businesses, but you should keep an eye on Revenue updates as EU-wide digital invoicing initiatives are gradually being introduced.

Financial and tax obligations for sole proprietors in Ireland

You are responsible for:

• Income tax: Sole proprietors are taxed as individuals, not companies. Profits are declared annually on your personal tax return (Form 11) under the self-assessment system, together with preliminary tax for the following year. Income is taxed at progressive rates: 20% up to €44,000 and 40% above this (for a single person in 2025).
• Universal Social Charge (USC): This is a separate tax on gross income, charged at progressive rates from 0.5% to 8%, with an additional 3% surcharge on self-employed income over €100,000.
• PRSI: Sole traders pay Class S PRSI at a flat rate of 4.1% of profits. This provides access to the State Pension (Contributory) and certain benefits, but coverage is more limited than for employees.
• VAT: Registration is mandatory if annual turnover exceeds €80,000 for goods or €40,000 for services. The standard VAT rate is 23%, with reduced rates of 13.5%, 9%, and 0% depending on the type of goods or services. VAT-registered businesses must file periodic returns and keep compliant invoices.
• Record-keeping: You must maintain accurate records of sales, invoices, receipts, and bank statements. Documentation must generally be retained for at least six years for possible inspection by Revenue. While a separate business bank account is not legally required, it is strongly recommended for clarity and compliance.

Launch your contracting career and stay compliant with Deel

Registering a sole proprietorship gives you independence, but it also means handling taxes, invoices, and records on your own. Deel’s all-in-one platform helps you manage obligations without the stress. With Deel, you can:

• Automate invoicing and expense tracking with essential Bookkeeping tools
• Create, send, and sign localised work agreements
• Keep accurate records for tax season
• Access expert tax advice and compliance support
• Get paid through multiple payment and withdrawal methods
• Spend your earnings in USD with the Deel Card
• Access funds early with Deel Advance
• Enjoy contractor perks from 150+ partners

Stay independent, without the admin overload. Sign up to Deel for free today.

FAQs

What is the minimum capital required to start a sole trader in Ireland?
There is no capital requirement.

Do sole traders need to register for VAT?
VAT turnover threshold varies depending on the business activity, and you must register for VAT if you exceed it. Currently, it is €85,000 for goods or €42,500 for services, but it's best to verify your obligations on the Revenue website.

How much are the standard monthly or annual contributions?
You pay PRSI via self-assessment (around 4-11%) plus income tax and USC. Preliminary tax must be paid by 31 October.

Can a sole trader hire employees?
Yes, but then you must register as an employer for PAYE with Revenue and withhold payroll taxes.

How long does it take to register as a sole trader in Ireland?
Online registration is typically the same day or a few days. Paper TR1 registration may take 2-3 weeks.

Can foreign nationals register as sole traders in Ireland?
EU/EEA citizens can. Non-EEA nationals must hold a valid permission to work or a business permission in Ireland.

Do sole traders need a separate business bank account?
Not mandatory, but strongly advised for clarity and professionalism..

What happens if I stop working as a sole trader?
You should de-register via Revenue and notify CRO if you used a business name. File any outstanding tax returns and pay due taxes.

Are there any government incentives or reduced rates for new sole traders?
Yes, some incentives apply, such as claiming the Earned Income Tax Credit (up to €2,000), which can reduce your tax liability.

Can I use Deel as a sole trader to get paid by international clients?
Yes. Deel supports sole traders (independent contractors) to receive international payments in multiple currencies, with low fees and transparent exchange rates.

Does Deel generate compliant invoices for sole traders?
Absolutely. Deel creates invoices that meet legal and tax requirements in Ireland and beyond.

Can Deel help me with taxes as a sole trader in Ireland?
Yes. Deel provides downloadable tax reports and payment records to help with filing and compliance. It’s not a substitute for an accountant, but it simplifies your record-keeping.

Does Deel offer contracts for freelancers and sole traders?
Yes. Deel includes contract templates that comply with Irish law and ensure safe, professional agreements with clients.

Can I access benefits through Deel as a sole trader?
Yes. Deel offers optional perks like health insurance and retirement savings plans, giving sole traders more stability and protection.