Financial planning is where good accountants earn their fee many times over. The clients who book a strategic conversation each autumn — not just a year-end return — routinely pay 20–40% less tax than peers and exit the business in far better shape. Below are the long-horizon questions we work through with practice owners, founders and family-business directors.
When should I start tax planning?
The honest answer: the moment you generate your first euro of taxable income. Tax planning isn't a year-end exercise; it's a year-round mindset. Practically, we recommend a formal planning conversation in Q3 (September) once you have a clear view of the current year's likely profit and time to act before year-end. Last-minute "rescue" planning in December rarely delivers more than 20% of what proactive planning achieves.
What's the difference between tax avoidance and tax evasion?
Tax evasion is illegal — concealing income, falsifying records, claiming non-existent expenses. It triggers penalties of 30–100% of the unpaid tax, interest and possible prosecution. Tax avoidance is the legitimate use of reliefs and structures provided in legislation to minimise tax — pension contributions, capital allowances, the EII scheme, incorporation, R&D tax credits. Aggressive avoidance schemes (mandatory-disclosure schemes) sit in a grey zone and almost always lose at the Tax Appeals Commission. Stick to mainstream reliefs.
Should I incorporate as a limited company?
Incorporation makes sense when profits consistently exceed €60,000–€80,000 and you can leave money in the company rather than extracting it all. Company corporation tax is 12.5% on trading profits versus a marginal rate around 52% for higher-rate sole traders. But incorporation adds compliance cost (€1,500–€3,500/year), restricts you in retirement planning, and means salary/dividend extraction has its own tax. Below €60K profit, most sole traders are better staying unincorporated. We model both scenarios for free.
How can I plan for retirement as a business owner?
Irish business owners have powerful pension options: PRSAs and personal pensions for sole traders, executive pensions and Self-Administered Pension Schemes for proprietary directors. Company contributions are tax-deductible for the employer with no benefit-in-kind for the director, growth inside the fund is tax-free, and you can take a 25% tax-free lump sum at retirement (capped at €200,000). For a 45-year-old company director, a €30,000 annual employer contribution typically grows to €1m+ by age 65 even at modest returns.
What business structures minimise tax?
There's no single magic structure — the best choice depends on profit level, family circumstances, exit plans and risk profile. Common Irish structures: sole trader (simple, full personal exposure), partnership (income-share, joint liability), limited company (12.5% trading rate, limited liability, more compliance), holding company structures (useful for groups or eventual sale), and the EII relief for raising investment. We typically review structure every 3–5 years or when profit moves through a major threshold.
When should I think about succession or sale?
Earlier than you think. Retirement Relief (CGT exemption up to €750k for assets sold/transferred between 55 and 70, reducing thereafter) and Entrepreneur Relief (10% CGT rate on first €1m of gains) require advance structuring — ideally 3–7 years before the event. We typically start succession conversations once an owner is in their early 50s, well before any plan to step back.
The C Royal & Co planning calendar
- January: Set targets for the new tax year. Review pension contribution capacity.
- April: Q1 management accounts and projected year-end profit. First capital expenditure planning.
- September: Pre-year-end strategy session — pension top-ups, capital allowances, dividend planning, family salaries.
- October: File Form 11 / pay preliminary tax with all reliefs claimed.
- December: Last-window company-pension contributions, asset purchases, structure review.
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