Self Employed / Professional

Our experience with Self Employed individuals is that they tend to fall into one of two categories:

  • Professionals – constrained by their professional body and/or regulation to operate under an ‘unlimited’ liability structure.
  • Small Business Owner – who, either due to turnover or other business restrictions, has been advised by their accountant not to incorporate into a limited company.

While many of the same issues arise for both categories, we find that it is best to analyse them separately as often they have quite different goals.

Professionals

Though there has certainly been pressure on all types of businesses in Ireland, we have found that many professions continue to provide a relatively good living, especially for those who may be qualified for a number of years. The main problems we see facing individuals like you include the management of company or practice debt, increasing tax liabilities (resulting in lower drawings) and a distinct lack of options around retirement provision.

We have a huge level of experience in assisting individuals from the professional fields, be they medical, legal or other. We always recommend that a client, such as yourself, undergo the full Financial Independence Planning Process because we know that by putting your employment in the context of long term goals we can better show you the impacts of our various recommendations.

The details of our Planning Process are available here, and we would advise you to read through and see if our philosophy and practice resonate with your own. Through the feedback received from clients, just like you, we know that there are a number of key factors that you will appreciate about how we do business. These include:

  • Offering a truly fee based advisory service. This includes the maintenance and provision of timesheets (as part of our invoices) to show you exactly what we spend our time working on for you. We believe the Financial Advice industry could learn a lot from the professions on operating fully transparent client files, and we believe we are at the forefront in doing just that.
  • Looking beyond your drawings to appreciate that the success of your practice/firm is intrinsically tied to your ability to create personal wealth. We’re not business advisors, but we can show you what best practice is for your industry based on our extensive experience.
  • Recognising the punitive taxation regime in operation in this country for the professional, and employing every possible scheme to minimise your exposure.
  • Forcing some discipline into your savings habits. By the very nature of your employment, it is often difficult to make immediate savings goals, let alone long term ones. The number of overdraft facilities in the professions for paying tax is testament to this. One of the most common pieces of feedback we receive from clients is that by showing them how much they need to save for the long term goals, we can help restructure the whole format of their remuneration, regularising income and creating huge peace of mind.
  • We are fully up to date on all the options available to those professions who have the facility to incorporate part of their practice or firm – setting up small limited companies to manage the office etc. Decisions around changing the method by which you earn your income should not be taken lightly and we offer full cost benefit analysis for all types of restructuring. We also work with a number of specialists who can help implement any change.

 

Small Business Owner

In many instances the small business owner who operates as a sole trader does so on the advice of their accountant. Whether turnover is not sufficient to warrant the extra costs associated with running a limited company, or simply due to the simplicity of the sole trader structure for your business, we recognise that that our role is to help you maximise your personal wealth through this process.

Nonetheless, for efficiently using the business as a method of wealth creation there is no doubt that the limited liability approach offers significant benefits over the sole trader route. Therefore, one of the main issues we address for business owners like you is whether you should look to change over. We provide a detailed cost-benefit analysis of any change, incorporating not just short term considerations but also the longer term impacts of one structure over the other. We believe that this should be the starting point for the entire planning process and only after that can we address your financial goals in a holistic manner.

Once a decision is made about the most appropriate way to run your business, we will then turn to the relevant options available to you. This incorporates our full review (details of which are available here) with extra focus on protecting you from future tax liabilities, effectively stripping profit from the business or carrying forward strategic losses.

We are confident that by following our recommendations you will have huge piece of mind around how your business is structured as well as identifying the means by which you can achieve your long term financial goals.

See our Sole Trader case study here.

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