IrelandManual

VAT registrations and simplifications in Ireland

When do I need an Irish VAT number?

Generally, a foreign business must register for VAT (Value Added Tax) in Ireland as soon as a taxable supply is made. The following are the usual examples of taxable transactions:

  • Domestic supply of goods not reverse charged: A supply of goods located in the Ireland where reverse charge does not apply requires a VAT registration of the supplier.
  • Supply of services not reverse charged: Foreign non-established businesses supplying services on which Irish VAT is due by the supplier must register for VAT. These services are rather exceptional, as the general B2B rule would apply.
  • Imports of goods in Ireland: when a non-established trader imports goods under his or her own name, a VAT registration is required in Ireland.
  • Export: Exporting goods to a non-EU country requires a VAT number before the export is made.
  • Intra-Community acquisition: Acquiring goods from another Member State where all conditions for intra-Community movements are met requires the customer to register for VAT.
  • Intra-Community supply: Supplying goods another Member State is also a taxable transaction that obliges the supplier to register for VAT. 
  • Distance sales: When applicable in case the Seller has not joined OSS. See the E-commerce manual for more information.

Non-established companies must submit apply for VAT registration before performing any of the above taxable transactions. There is no turnover threshold applicable to non-established companies.

Irish established companies can benefit from a VAT registration exemption threshold ranging from EUR 41,000 to EUR 75,000. The thresholds are calculated based on your turnover in any continuous 12-month period, and they depend on your activity, for example, if you are an Irish establish company supplying goods, you can benefit from the VAT registration exemption threshold of EUR 75,000, while if you are making intra-Community acquisitions of goods, the threshold reduces to EUR 41,000. In any case, a voluntary VAT registration is allowed. 

Backdated registrations are allowed in Ireland upon agreement with the tax office. You will need to regularize past reporting periods as from the registration date.

Input VAT incurred previous to the VAT registration may be normally deducted, provided that the cost complies with the VAT deduction limits in Ireland. This input VAT will be included in the first VAT return submitted by the taxpayer and a backdated registration is required. 

Check here the official information about Who should VAT register in Ireland. Also, have a look at the guide for non-establish businesses concerning VAT registration. Finally, check here the obligation to VAT register in Ireland to make an import.

VAT registration pack in Ireland

The registration pack for a non-Irish established company shall contain the following documents:

  •  Agent Link Notification: this is a PoA appointing Marosa Ltd as an agent.
  •  Registration form.
  •  Supporting documents of the company that applied for the VAT registration.

The registration pack for non­-resident companies must be sent to:

Business Registration South. Office of The Revenue Commissioners

PO Box 1

Wexford. Ireland

However, registration packs are often accepted when sent via email to the tax office. Usually, the tax officer will send further questions to understand the company’s activity, reason for VAT registration and, particularly, why we have requested an IC VAT number.

More details about VAT registration in Ireland can be found here. Also, find more information about eRegistration.

VAT number format in Ireland

  • Country code: IE
  • Structure: IE 9S99999L
  • If you are registered for VAT in Ireland, the VAT number is formed using the country code IE and 8 or 9 digits.

Find here and here you will find general information about EU VAT numbers.

Fiscal representative requirements in Ireland

Some countries require all non-EU companies to appoint a fiscal representative when registering for VAT. However, this requirement does not apply in Ireland.

VAT groups in Ireland

VAT grouping is possible in Ireland for businesses established in Ireland. Group members must be closely bound by financial, economic, and organizational links, so they may form a VAT group and be treated as a single taxable person for VAT purposes in Ireland.

In addition, the following VAT grouping rules apply in Ireland:

  • Only Irish established business can be part of a VAT group. It is not a condition that every member of the group has to be an accountable person. Holding companies are permitted to be part of a group.
  • VAT grouping is optional in Ireland and, once is formed, the group members are treated as a single taxable person. VAT group registration is subject to approval by Revenue based on the interest of efficient administration.
  • Invoices: each member of the group must issue an invoice for its individual supplies under its own name and quoting its individual VAT number.
  • Intra-group transactions are disregarded for VAT purposes.
  • Every group member is jointly and severally liable for the VAT debts and penalties of the entire group.
  • One of the members of the group is established as the group remitter. This member becomes responsible for dealing with all VAT requirements for the whole group: including the submission of VAT returns and making VAT payments

Learn more about VAT groups in Ireland.

Consignment and Call-off stock in Ireland

The EU introduced a call-off stock simplification that all EU Member States must implement. This was put into place so that businesses that operate under a consignment stock structure do not have to VAT register in the country of destination. Ireland has introduced the consignment stock simplification.

Check out our article on the EU call-off stock simplified VAT rules for more detailed information.

Irish Bad Debt Relief

Bad debt refers to an unpaid invoice for which the Supplier has paid the VAT to the tax administration: this is, an invoice has been issued with VAT, reported in the VAT return and the VAT amount has been paid to the tax authorities but the whole price has not been collected from the customer. This is often due to the client´s bankruptcy, insolvency or simple missed payments to suppliers. In these cases, most countries allow to recover the VAT initially paid to the authorities, however, the conditions change from one country to another.

Bad debt relief refers to the possibility of recovering the VAT from that invoice. Ireland allows for bad debt relief, unless for taxpayers under the cash accounting scheme.

Bad debt relief is done by adjusting the output VAT paid in the periodic VAT return, i.e., by increasing the VAT on purchases figure in Box T2 on the VAT return form.

Before proceeding with the bad debt relief, it is required that the supplier has carried out reasonable steps to obtain the payment of the debt.

  • Actions taken include correspondence with the debtor, referral of the issue to a solicitor or a debt collection agency or other action undertaken which results in objective evidence that the trader is in a position to reasonably consider that the debt is bad.
  • Suppliers are required to retain evidence of action taken, including all correspondence, in attempting to recover the debt

Find here the official information about bad debt relief in Ireland, as well as the official guidance available to download.

Irish Import Deferral and Postponed VAT Accounting

Ireland has introduced a postponed import VAT accounting mechanism where import VAT can be reported as input and output VAT (reverse charged) in the VAT return instead of being paid to the authorities upon importation. Postponed import VAT accounting applies automatically if conditions are met. Taxpayers do not need to file a separate application. The VAT Return and Annual Return of Trading Details (VAT RTD) require include the correspondent reporting entries relating to postponed accounting.

Import VAT deferral, meaning delaying the payment of VAT for a given period, is also applicable in Ireland. VAT deferment accounts allow importers to pay import VAT and customs duties on the 15th day following the end of the month. To apply for deferred payment authorization, the taxable person must already hold a customs guarantee with the Revenue Commissioners.

Find here and here more information about postponed import VAT accounting in Ireland.

Have a look at our general article about postponed import VAT accounting

Irish Customs and VAT warehouses

Customs or bonded warehouses are available for goods that have not cleared customs in the EU (T1). VAT and excise duties are not due when these goods are directly placed in the Customs warehouse. As soon as they exit this regime, these amounts are due. Sales within the customs warehouse are zero-rated.

VAT warehouses are available for cleared goods (T2). These goods have already paid customs duties. The conditions are similar to those of Customs warehouses. The goods allowed are those included in Appendix V of the VAT Directive.

Read more about Customs warehouses. Also, find here additional information.

Finally, find here official EU guidelines on Customs’ special regimes.

Special VAT Schemes in Ireland

Businesses may benefit from the following special VAT regimes:

1.       Small businesses – only for established companies-.

2.       Farmers. Find more information here.

3.       Travel agents

4.       Margin scheme

5.       Cash accounting, moneys received basis of accounting. Find more information here.

Have a look at our website articles about TOMS and the Cash accounting scheme.

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