Thinking of Reviewing Your Company Solution?

As your contracting career develops, it's well worth reviewing whether your current company solution is still the right fit. Circumstances change, and the setup that suited you at the start of your journey might not be the one that helps you take home the most from your contract today. The good news is that reviewing your options, and switching if it makes sense to, is usually far more straightforward than contractors expect. Here's what's involved.

Switching between umbrella solutions

If you're operating through an umbrella company, this is very much an easy switch. The main reason we see contractors change their company solution here is simply to change the rate of PRSI they pay. Most move from the PAYE Umbrella Company, paying Class A PRSI, across to the Director Umbrella Company, which is more tax efficient when paying Class S PRSI and allows contractors to maximise their pay.

There are really only two things to think about when making this move:

• Your invoice and payment schedule. Once we know the best dates for you to make the move, we'll organise everything around them so there's no disruption to your pay.
• An update to your contract for services. The old umbrella company name you operated under, and its associated details, will be removed. The new company details are then updated on your contract with your client or agency to reflect the change.

That really is the extent of it. For most contractors switching umbrella solutions, the change happens quietly in the background while they carry on with their contract.

Moving to your own Personal Limited Company

If you're looking to make the move to operating through your own Personal Limited Company, the process is a little different. The main thing to bear in mind here is the time it takes to open and set up the Personal Limited Company solution, so it's worth planning ahead rather than leaving it to the last minute.

What you should consider before you start

Setting up a Personal Limited Company creates real opportunity, but it also comes with some additional responsibilities. Here's what to weigh up before you begin.

Incorporation and tax registration

• Cost: €249 plus VAT for company setup, plus €20 for the B1 submission.
• Timeline: The certificate of incorporation is typically issued within 5 to 7 working days. Full setup, including VAT and tax registration, usually takes up to 6 weeks.

Choosing a company name

Your company name must be unique and cannot match an existing registered company. We recommend incorporating using your initials, or references linked directly to your profession. If you're unsure, our Personal Limited Company team can guide you.

Registered office

You'll need a registered office address in Ireland. This can be your residential address if business premises aren't available.

Business bank account

A business bank account must be opened in your company's name once your incorporation certificate has been issued. Company and personal finances should always remain separate.

Director and secretary requirements

You cannot act as both the sole director and the company secretary. Your options are to:

• Appoint another individual as company secretary while you remain sole director, or
• Appoint another director while you take on the dual role of director and company secretary.

Once the company setup is complete, your contract will be updated, and you can then make the move to operate and process payroll through your own company.

Whether it's a quick switch between umbrella solutions or a move to your own Personal Limited Company, we'll talk you through the options and handle the change from start to finish. Talk to the Icon Accounting team.