The beginner's Guide to Becoming a Freelancer in Ireland

There are over 331,000 self-employed people in Ireland, and freelancers make up an ever-increasing percentage of them. Every day across the Emerald Isle, people with a wide range of skills, interests and backgrounds choose to become freelancers and work as independent professionals. If you're ready to join their ranks, this guide will tell you everything you need to know to start your solopreneur journey.

Why are people becoming freelancers in Ireland?

People in Ireland become freelancers in order to be their own boss, set their own schedule and, in many cases, make more money. A 2021 report on Ireland's project economy found that highly skilled freelancers earn around 58% more than equivalent employees. The study also found that independent contractors report higher job satisfaction and face less gender and age discrimination than people working for traditional employers.

How to register to work legally as a freelancer in Ireland

To become a freelancer in Ireland, you must register as self-employed with the Revenue Commissioners. The term self-employed refers to all people who work for themselves instead of for a company or an individual employer, including business owners, startup founders, solicitors, tradespeople, agents and freelancers.

While all freelancers are self-employed, not all self-employed people are freelancers. Self-employed people such as business owners and startup founders often sell products and may hire employees ⁠— or freelancers ⁠— to help them. In comparison, freelancers tend to work alone and offer services to multiple clients for a set fee or an hourly rate. Professionals like writers, graphic designers, web developers, online tutors and business consultants typically call themselves freelancers.

Legal obligations for freelancers in Ireland

As a self-employed freelancer, it's important to understand your legal obligations to the Irish government. Here are some of your responsibilities.

Income Taxes for freelancers in Ireland

People who work for traditional employers have their income tax automatically deducted through the PAYE, or "pay as you earn," system. However, as a self-employed freelancer, you are responsible for declaring and paying your own taxes. To be in compliance, you must complete an Income Tax self-assessment" and pay any tax you owe by 31 October every year.

Your tax liability is based on your income for the previous year. For example, you will pay taxes on your 2022 income on 31 October 2023. You are also required to pay preliminary tax, which is an estimate of your Income Tax, Pay Related Social Insurance and Universal Social Charge for the current tax year. It's important not to underestimate your preliminary tax, or you will be charged penalties and interest.

Value Added Tax for freelancers in Ireland

Value Added Tax, also known as VAT, is an indirect consumption tax payable on the sale of goods and services in Ireland. As a freelancer, you will need to register for VAT if you expect your annual turnover to exceed €75,000 for goods or €37,500 for services over a 12-month period.

The standard VAT rate in Ireland is 23%, but the government charges reduced rates of 13.5% and 9% for certain goods and services. To learn more about Irish VAT rules and procedures, including how to register, check out Xolo's detailed VAT guide for freelancers.

Accounting for freelancers in Ireland

To accurately calculate your freelancing income and taxes, it's essential to keep on top of your finances. One of the best ways to do that is by hiring an accountant or using accounting software. It's also helpful to open a business bank account to separate your business expenses from your personal spending.

A tool like Xolo Go can help you start your business out on solid financial ground. Not only does it help you create invoices in multiple currencies, but it also makes it easy to manage your business expenses and create withdrawal reports for your accountant.

the freelancer's favorite pay-as-you-go invoicing tool

Best tools for freelancers in Ireland

Being your own boss offers multiple professional and personal benefits, but it also comes with many non-chargeable responsibilities. You need to do things like market your business, find projects and send invoices to clients. Luckily, there are great tools available to help you efficiently manage the administrative side of your business.

Tools to showcase your skills as a freelancer

You have skills, and you want to show them off. There are several tools that can help you achieve this, depending on your freelance niche and goals. Wix, Squarespace and Wordpress are great for building professional-looking websites, while sites like Contently, Journo Portfolio and ArtStation give you platforms to showcase your portfolio.

Tools to find clients as a freelancer in Ireland

Do you need help finding clients? Platforms like marketplaces can connect freelancers with people and companies looking for independent workers. Just sign up, create a profile, find a project that fits your skill set and start earning money.

Tools to manage your time as a freelancer 

As a freelancer, time is money, so you need to manage it wisely. Tools like Toggl, Timely and Time Doctor help you track your time and productivity, ensuring you make the most of each workday. Meanwhile, apps like Trello and Asana are great for project management.

Tools to organize your work as a freelancer in Ireland

Businesses generate a shocking amount of documents, including project outlines, meeting notes and tax returns. Tools like Evernote, Bear, Dropbox and Google Docs help you organize your documents in the cloud, so they'll be available whenever, and wherever, you need them.

Tools to get paid as a freelancer in Ireland

You've done the hard work, and now it's time to get paid. Not sure how to go about it? With Xolo Go, you can easily create invoices, accept payments and manage your expenses. Best of all, it uses a pay-as-you-go model, so you won't be saddled with a long-term contract or surprise fees. You just pay a 5% commission on payouts.

How to start a freelancing business in Ireland

While it's easier than ever before to launch a freelancing career, it still takes some thought and planning to make it a success. By following these steps, you can start out on the right foot.

Create a launching plan for your freelance business

You could technically wake up tomorrow morning and call yourself a freelancer, but you can make the most of your journey by creating a launch plan. Take the time to identify your marketable skills and target customers, then build a portfolio and create a strong marketing pitch. You won't be sorry.

Choose the best legal business entity to open a freelancing business in Ireland

When you register as self-employed with the Irish government, you'll be classed as a sole trader. This means you run your own business and are solely responsible for its successes and failures. Most freelancers stick with this business structure because it's easy and cheap to set up. However, the downside is that creditors could come after your personal assets if your business fails. You are also taxed at the personal income tax rate⁠ — which is higher than the corporate rate ⁠— and lose out on certain tax breaks.

Another option is for you to register as a limited company, which means your business will be a separate entity. This arrangement gives you access to the lower corporate tax rate and protects your personal assets from creditors. However, those privileges come with strict compliance rules and some other forms of bureaucratic red tape.

You can learn more about sole trader and limited company business structures on the Irish Citizens Information website.

Register and open your freelancing business in Ireland

If you create a limited company in Ireland, you must choose a business name and register it with the Companies Registration Office. Sole traders aren't required to use a business name, but they are free to create and register one if they wish. You can register your business name electronically via the Companies Online Registration Environment for a fee of €20. Alternatively, you can download the required form and mail it to the CRO for a fee of €40.

If opening a freelancing business in Ireland sounds daunting, you may want to consider registering your company in a country such as Estonia, which has the most advanced digital infrastructure in the world. Xolo Leap helps you establish a fully-remote, tax compliant EU business through Estonia's e-Residency program, giving you access to the country's attractive corporate tax rate and a host of other benefits. The entire process is simple, fast and affordable.

Ready, set, go!

There has never been a better time to freelance in Ireland. With a little planning and the right tools, you can become your own boss and start working with clients all over the world. Whether you want to register your solopreneur business in Ireland or create a remote company in Estonia, Xolo has you covered. Xolo Go and Xolo Leap take the stress out of running your business, leaving you free to pursue your freelance passions and maximize your earning potential. Become a freelancer or launch your fully-remote business-of-one.

fully-remote-solo-business

Freelance