Some of the advantages would be:
Limited liability - Your personal assets are not at risk.
Investors - Investors have more protection and transferring shares is straightforward.
Bank finance - Banks prefer to deal with companies as they can take out extra security.
Tax relief - Start-ups may be exempt from corporation tax for the first three years.
Tax savings - Companies pay lower tax and no PRSI on profits.
Some of the disadvantages would be:
Administrative burden - The company will have to submit annual accounts and more returns.
Less privacy - The company’s details and accounts are held on public record.
Bank finance - Banks may ask for personal guarantees from the directors.
Mixed Use Assets/Expenditure – Company assets or expenditure which are used for both private and personal expenditure can lead to tax charges, PRSI and more reporting requirements.
Losses - Losses made by a company can only be utilised by the company.
Disclaimer: Advice shared in this blog is intended to inform rather than advise. Taxpayer's circumstances do vary and if you feel that the information provided is beneficial it is important that you contact us before implementation. If you take, or do not take action as a result of reading this forum, before receiving our written endorsement, we will accept no responsibility for any financial loss incurred.