As a sole trader you file a Form 11 each year and pay income tax, USC and PRSI on your profits. For 2025 income the deadline is 31 October 2026, or 18 November 2026 if you both pay and file on ROS. We prepare your accounts and Form 11, work out your preliminary tax and claim the expenses you are entitled to.
Information checked 3 October 2026 against Revenue and CRO guidance.
What's included
Your profit is taxed as your income, whether you take it out of the business or not. For 2026 that means three charges:
| Charge | Rate |
|---|---|
| Income tax (single person) | 20% on the first €44,000, 40% on the rest, less a €2,000 personal credit and an Earned Income Tax Credit of up to €2,000 |
| USC | 0.5% on the first €12,012, 2% on the next €16,688, 3% on the next €41,344, 8% on the balance |
| Class S PRSI | 4.2% to 30 September 2026 and 4.35% from 1 October 2026, minimum €650 |
Sources: Revenue tax rates, Revenue USC, Citizens Information, Class S PRSI.
Preliminary tax is an advance payment of this year's income tax, paid by the Form 11 deadline. You avoid interest if it covers at least 90% of this year's tax, 100% of last year's tax, or 105% of the tax for the year before last. The 105% option is only for people who pay by monthly direct debit.
Worked example
| Option | Calculation | Preliminary tax |
|---|---|---|
| 90% of 2026 | €22,000 x 90% | €19,800 |
| 100% of 2025 | €18,500 x 100% | €18,500 |
| 105% of 2024 (direct debit only) | €16,000 x 105% | €16,800 |
Paying the lowest safe figure keeps cash in the business for longer, but the balance still falls due with next year's return.
A surcharge is added to the tax: 5% (up to €12,695) if the return is filed within two months of the deadline, and 10% (up to €63,485) after that. Interest on late income tax runs at 0.0219% a day, roughly 8% a year.
You can deduct costs incurred wholly and exclusively for the business: stock and materials, rent of business premises, business insurance, accountancy fees, and the business share of phone, broadband and motor costs. A cost with a private element, such as a car you also use at weekends, is claimed only for the business share. Equipment, tools and vans are claimed through capital allowances over several years rather than as a single expense.
Companies pay Corporation Tax of 12.5% on trading profit, against income tax of up to 40% plus USC and PRSI for a sole trader. The saving only arrives if you can leave profit in the company, and a company brings CRO filings and stricter rules on taking money out. Our guide Sole trader or limited company? works through the numbers.
Register for income tax with Revenue as soon as you start trading. If you trade under a name other than your own, you also register that business name with the CRO.
Source: Revenue: How to register for tax as a sole trader, checked 3 October 2026.
Yes. You can pay preliminary tax by monthly direct debit, which Revenue collects on the 9th of each month. Direct debit payers can also use the 105% option based on the tax for the year before last.
Source: Revenue: Preliminary Income Tax Direct Debit Guidelines, checked 3 October 2026.
Often not. Because preliminary tax can be 100% of the previous year's tax, and that is nil before you start trading, many new sole traders pay none in year one. The catch is a bigger bill the following October, when the first year's balance and the second year's preliminary tax fall due together.
Source: Revenue: What is preliminary tax?, checked 3 October 2026.
Only once your turnover passes €42,500 in a calendar year for services, or €85,000 if you mainly sell goods. You can register earlier by choice if that helps your business.
Source: Revenue: What are the VAT thresholds?, checked 3 October 2026.
Next step
Book a call at a time that suits you, or ring the office.
Monday to Friday, 8.30am to 5pm · info@mawhately.ie
We use cookies the site needs to work. With your permission we would also use Google Analytics to see how the site is used, and Google Ads cookies to measure our adverts. Nothing optional is set until you choose, and you can change your mind any time with "Cookie settings" at the foot of every page. Privacy policy
Newsletter
Budget changes, Revenue deadlines, new free tools and what AI means for your business, from M.A. Whately.
