A clear-eyed comparison for independent contractors in Ireland
When you land your first big pharma contract, one of the first financial questions you'll face is:
Should I operate as a sole trader or set up a limited company?
There’s no one-size-fits-all answer — but if you’re working with multinational pharma clients, the structure you choose affects your tax, legal protection, and long-term strategy in ways you might not expect.
Let’s walk through the key considerations.
Sole Trader:
Register with Revenue as self-employed (ROS).
Simple to start — minimal paperwork.
You operate as you — no separate legal entity.
Limited Company:
Register with the Companies Registration Office (CRO).
Appoint a director (likely you), issue shares, and open a company bank account.
The company is a separate legal and tax entity.
🔗 Want a full checklist? Download our [Contractor Setup Guide].
Sole Trader:
You pay Income Tax, PRSI, and USC on all profits.
Top rates can hit 52% once you cross €36,800 (single person).
Limited Company:
The company pays 12.5% Corporation Tax on profits.
You decide when and how to take money out — via salary or dividends.
With planning, effective tax rates can be much lower.
Example:
A contractor earning €120,000 could save €7,000–€12,000 per year via strategic company structuring.
✅ This is where our [Strategic Tax Review] comes in — not just compliance, but smart planning.
Sole Trader:
No legal separation — you’re personally liable for business debts and legal claims.
Limited Company:
The company holds contracts, invoices clients, and bears liability.
You’re protected — unless you’ve given personal guarantees or acted recklessly.
For pharma contractors working in regulated environments or technical risk zones, this can be a major advantage.
Your business might be just you today — but what about 3 years from now?
Will you bring on a subcontractor?
Want to sell or transfer your business?
Need to build up retained earnings for time off?
Only a company structure gives you this kind of flexibility.
We work with many contractors who began as sole traders and later needed to restructure — often at unnecessary cost and complexity.
This one’s often overlooked:
Some multinational companies will only contract with limited companies — not individuals.
Why?
It protects them from perceived employer obligations (PAYE risk) and streamlines procurement.
We’ve seen contracts fall through when a contractor wasn’t set up correctly.
| Question | Our View |
|---|---|
| Just starting out, small gigs? | Sole trader might suffice (for now) |
| €70k+ income or long-term contracts? | Limited company almost always better |
| Pharma MNC clients? | Set up a limited company from day one |
| Want tax flexibility & personal protection? | Company wins again |
We help pharma engineers and technical contractors set up the right way — not just to tick boxes, but to build real financial stability.
📞 Book a free onboarding call
We’ll walk through your current setup, future plans, and whether a company makes sense — and if it does, we’ll handle everything.
👉 Or dive deeper in our [Ultimate Guide to Financial Strategy for Pharma Contractors] — Section 1 breaks this down further.