7 tips to start a business

by Debbie Cheevers | May 20, 2020

7 tips to start a business in Ireland today.

We’ve outlined 7 tips for when you’re starting your business in Ireland. We have over 40 years of experience running all types of businesses in Ireland.

If you need help with your business, no matter what size or stage, contact us here. Here are Greenway’s 7 tips to start a business in Ireland today.

Not everyone is cut out to start a business
Pick your niche to start a business in
Solve your customer’s problems
Know your numbers
Financing your business
Expansion is hard
Pay yourself right as soon as possible.

1. Not everyone is cut out to start a business

We’ve seen many people who start a business and don’t know how to sell themselves. You have to talk confidently about yourself and your business. You need to explain what your business does in a few words. If someone asks me what we do I say:

“Greenway has two customer bases. We provide personal financial advice on savings, mortgages & pensions. We help SME businesses with growing and developing their profitability & efficiencies.

2. Pick your niche to start a business in

Try to start a business in an area of the market currently underserved. This will make it cheaper to market and easier to attract customers. Look for gaps where you can serve customers better.

What are the online or phone services like for the product you are selling?
Is there a call out, emergency or maintenance element to your business?
What are other services or products you can sell that would solve/benefit your customers?
Pick two of these three options and stick with it: Your business will be: 1. Fast, 2. Cheap, 3. Good.

3. Solve your customer’s problems

You are the most valuable to your customers when solving their problems, not just answering their needs. Talk to your customers and ask them about their pain points. You might find simple solutions that you could start a business around. You can hire an IT help desk service to help you manage your IT problems. Take the time to build relationships with your customers so they trust you and want to work with you again in the future. You never know where your business might lead you!

4. Know your numbers

Know your costs, break-even and profit margins. You have to have these numbers off the top of your head, and written down. If I meet a business owner owe does not know their rounded costs off the top of their head I start to worry. If they don’t know their costs they are not making money.

5. Financing your business

If you’re just about to start a business, don’t worry about finance. Look at low-cost ways of operating that will give you a feel for the market and start developing your sales.

When you have a proper business plan written you can approach your local enterprise office for some initial funding to get yourself going.

6. Expansion is hard

Make sure you know how to manage staff effectively. Don’t forget your their boss, not their friend. We’ve seen too many businesses where staff start running the show and dictating how the business should operate. This is geared to their benefit, not the customers.

Make sure you find an effective management style for yourself and a clear communication method if issues with staff performance start happening.

7. Pay yourself right as soon as possible.

We’ve seen too many business owners who pay themselves a fraction of their worth. When there is money in the company, make sure you give yourself a fair & reasonable market salary.

It will help you feel good about yourself and encourage you to keep selling and growing your business.

1. Do you pay tax on a gift in Ireland?

You may have to pay Capital Acquisitions Tax (CAT) if the total value of gifts you receive from a particular group exceeds your lifetime tax-free threshold.

The person receiving the gift (the beneficiary), not the person giving it, is responsible for paying CAT if it applies.

However, many gifts fall within tax-free limits such as the Small Gift Exemption or the relevant group threshold.

2. How much money can you gift to a child tax-free in Ireland?

A child can receive up to the Group A threshold (€400,000) tax-free over their lifetime from a parent.

In addition, any person can gift €3,000 per year to another person under the Small Gift Exemption. This does not reduce the lifetime threshold.

For example, two parents could gift a child €6,000 per year (€3,000 each) completely tax-free.

3. What is the Small Gift Exemption?

The Small Gift Exemption allows a person to receive €3,000 per year from any individual without paying CAT.

Key points:

It applies per disponer (gift giver), per calendar year.
It does not reduce your lifetime threshold.
There is no limit to the number of people you can receive €3,000 from in a year.

4. What are the CAT group thresholds?

There are three tax-free thresholds depending on your relationship to the person giving the gift:

Group A – €400,000 | Applies mainly to children receiving gifts from parents.
Group B – €40,000 | Applies to siblings, nieces, nephews, grandchildren and certain other relatives.
Group C – €20,000 | Applies to all other relationships.

If the total value of gifts received from a group exceeds the relevant threshold, CAT is charged at 33% on the excess.

5. What is the current gift tax rate in Ireland?

The current Capital Acquisitions Tax (CAT) rate is 33%.

This rate applies only to the amount above your relevant tax-free threshold.

6. If I receive multiple gifts, how is tax calculated?

All gifts received from the same group since 5 December 1991 are aggregated together.

For example, if you received €100,000 from a parent previously and then receive €350,000 more, your total is €450,000.

Since the Group A threshold is €400,000, CAT would apply to €50,000.

7. Do I have to file a tax return for a gift?

You must file a CAT return (Form IT38) if:

The value of gifts received exceeds 80% of your relevant threshold, or
You owe CAT.

Filing deadlines depend on the valuation date of the gift.

8. What is the valuation date for a gift?

The valuation date is usually the date the beneficiary becomes entitled to the gift and can benefit from it.

For most straightforward cash gifts, this is the date the money is transferred.

9. Are gifts between spouses taxed?

No. Gifts between legally married spouses or civil partners are fully exempt from CAT.

10. Can I gift money to help my child buy a house?

Yes. Many parents use a combination of:

The Small Gift Exemption (€3,000 per year), and
Part of the Group A lifetime threshold (€400,000)

Careful planning is important to avoid unexpected tax issues, particularly if previous gifts have already been made.

11. Is inheritance tax the same as gift tax?

Both fall under Capital Acquisitions Tax (CAT) in Ireland.

The same group thresholds and 33% rate apply, but the timing and valuation rules differ between gifts and inheritances.

12. How can I reduce or plan for gift tax?

Planning options may include:

Using the Small Gift Exemption annually.
Structuring larger gifts over time.
Considering Section 72 or Section 73 life assurance policies.
Taking professional financial planning advice.

Proper estate planning can significantly reduce future tax exposure.

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Debbie Cheevers

Qualified Financial Advisor (QFA), Retirement Planning Advisor (RPA), Technician Member of the Irish Taxation Institute

Debbie, a Dublin native, earned her degree in Visual Communication from NCAD before transitioning into the financial sector. She brings a strong customer service background to Greenway.

She became an Accredited Product Adviser (APA) in 2017 and achieved full qualification as a Financial Advisor (QFA) in 2018. Debbie has also added a tax qualification as a Technician Member of the Irish Taxation Institute and is a certified Retirement Planning Advisor (RPA).

With a deep belief in the power of product knowledge, she is committed to guiding clients toward informed financial decisions.

Contact Debbie Now