What is the Difference between a Company and a Business Name?

When you set up a company, you have incorporated a legal entity in its own right; separate and distinct from those who run it. Shareholders own the company but are not responsible for the obligations which the Company may take on. Thus the company may be sued for any defaults which it may incur, but not the shareholders. Companies can also benefit from limited liability.

A business (or trading) name, is just that – a name. No legal entity is formed and there is no limitation on liability. This name can be owned by a sole trader, a partnership or a company. Whoever (or whatever) owns the Business Name is still responsible for the obligations which are taken on under that name. A Business Name has no shareholders, directors or secretary and many of the legal responsibilities which apply to Companies do not apply to Business Names.

Taking a Business Name can be a useful option for those who don’t want to set up a company just yet but wish to trade under an alias, alternatively if your heart is set on a certain company name but it has already been taken then you can just apply for a Business Name on behalf of your company. Your company can then you can trade under the Business Name. The company need not have a name which is similar to the Business Name which it acquires.

There are no restrictions in terms of duplication or similarity when it comes to Business Names. This means that while the company name ‘Murphy’s Bar Limited’ in Ireland is unavailable, there are many businesses which are run under the name ‘Murphy’s Bar’. Meanwhile your actual company can be called something completely unrelated such as ‘ABCD Limited’.

If you are trading under a name other than your own true name it is a legal requirement for you to register a Business Name. The purpose of a Business Name is to make public the identities of those individuals, partnerships or corporate bodies being the legal entity behind the Business Name. Creation of a Business Name doesn’t provide limited liability. A Business Name doesn’t have to file annual accounts.

It should be noted that the registration of either a company or Business Name does not mean others do not have rights in that name. So it is advisable to carry out a Trademark Search at the Patents Office. An Online Trademark Search can be done in a matter of seconds. Registering your Trademark creates an official record of your rights as owner of a particular Trademark and makes it easier to prevent others from using it.

Only residents of the Republic of Ireland can register as Sole Traders or Partnerships in Ireland. Residents who do not have an Irish citizenship, must have a Stamp 4 and a letter of business permission from the Department of Justice to register a Business Name as as Sole Trader or Partnership.

We can Register your new Business Name for you. We charge €70 (ex VAT) for this service.