FAQs

How do I check if an E.U. trader is VAT registered?

A facility is made avilable by the E.U. Commission to allow traders to check whether a VAT number quoted by an E.U. trader is valid. This can be accessed by following the link below. This facility is not provided by Revenue, and we cannot take direct responsibility for the accuracy of the information. VIES VAT Number Validation.

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I am a flat rate farmer and I am going to buy a combine harvester in the UK. Do I have to register for VAT?

Yes, if the cost of the machine exceeds €41,000 (or if the annual total of your acquisitions from other countries, including the combine, exceeds €41,000) you are obliged to register for VAT and pay VAT on the cost of the machine at the standard rate. You are not entitled to claim back this VAT. This registration for VAT is in respect of your E.U. acquisitions only. You may retain your unregistered (flat-rate) farmer status in respect of your normal farming activities.

Further information is available in the information leaflet on the subject of Farmers and E.U. Transactions on the Revenue website.

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I am a VAT registered person. Can I buy goods VAT free from a business in another Member State of the E.U.?

Yes, once the goods are purchased for the purposes of your business. The purchase of goods from a person in another E.U. Member State is called, in VAT terminology, an 'intra-Community acquisition' of the goods. The sale of goods to a VAT registered person in another Member State is called an 'intra-Community supply'. The procedures to be followed are set out below:

  • You must quote your VAT number to the supplier. The supply will then be zero-rated in the Member State of dispatch as an E.U. intra-Community supply.
  • You (the taxable customer) become liable for VAT on the acquisition of the goods in this State. You must account for VAT on the goods at the rate that would apply to the supply of those goods in Ireland.
  • To do this, you declare a liability for VAT in your VAT3 return form in the T1 box.
  • If you are entitled to full deductibility (input credit), the VAT payable on the intra-Community acquisition is deducted in the same VAT period at T2 on the VAT3, thus effectively cancelling out the VAT liability. If you are not entitled to deductibility (e.g. flat-rate farmer, State body) you put a zero in the T2 box. If you are entitled to partial deductibility, and the good represents a 'dual-use input', you may claim the appropriate percentage of the VAT, as agreed with the local Revenue District.
  • You must also account for VAT on any subsequent supply of the goods in the appropriate VAT return.

In addition to the accounting requirements above, the VAT 3 return requires the taxable person to declare summary VAT details. It includes a statistical box in respect of intra-Community Acquisitions that must be completed (E2).

Further information is available in the information leaflets on the subjects of E.U. Intra-Community Acquisitions and E.U. Intra-Community Supplies on the Revenue website.

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What are Fourth Schedule services

Fourth schedule services are so-called because they are listed in the Fourth Schedule to the VAT Act 1972 (as amended). They consist of services that are liable to VAT in the country where the customer is established (provided they have been supplied across international boundaries for the purpose of the customer's business).

The general rule for services is that they are taxable at the place where the supplier is established, or where the work is actually carried out. For example, a garage in Ireland carrying out repair work on a vehicle belonging to a U.K. haulage company will charge Irish VAT.

Where Fourth Schedule services are supplied to a VAT-registered customer established in another Member State of the E.U., the customer must account for VAT on the supply. For example, a consultant in Ireland providing services to a company in the U.K. will issue an invoice at zero percent VAT, and the customer in the U.K. will account for the VAT. The customer's U.K. VAT number should be included on the invoice.

Fourth schedule services are generally intellectual or intangible by nature; e.g. consultancy services, banking, financial and insurance services. Services in the Fourth Schedule that are directly connected with property are liable to VAT where the property is located, regardless of where the supplier or the customer are established.

Further information is available in the Fourth Schedule Services Information Leaflet on the Revenue website.

How are foreign firms doing business in Ireland treated for VAT?

Foreign firms who are not established in Ireland and who supply taxable goods or services here are generally obliged to register and account for Irish VAT. The turnover thresholds for VAT registration which apply to Irish suppliers do not apply and such suppliers must register regardless of the level of their turnover.

Non-established foreign firms are generally required to register where they:

  • import goods into the State;
  • supply goods within the State;
  • supply goods on board vessels, aircraft or trains leaving the State for another Member State;
  • engage in distance selling of goods to a person who is not a taxable person in the State;
  • engage in the supply of services connected with immovable goods located in the State, including the services of builders, plumbers and the like (other than sub-contractors engaged in construction services), estate agents, architects and firms providing cleaning and security services and on site supervision in relation to property;
  • engage in the transport of goods or ancillary transport activities within the State (other than intra-Community transport services), and intra-Community transport services beginning in the State for an customer who is not registered for VAT;
  • engage in cultural, artistic, sporting, scientific entertainment or similar services in the State;
  • engage in the valuation of movable goods within the State, including contract work;
  • engage (in the case of suppliers established outside the EU), in the hire of movable goods for effective use within the State;
  • engage in the supply of a telecommunications service, or telephone cards, or radio or television broadcasting services from outside the EU to a private individual in the State in certain circumstances;
  • engage in the supply of electronic services from outside the EU to a private individual whose usual place of residence is the State. These services include the following:
    • website supply, web-hosting, distance maintenance of programmes and equipment
    • supply of software and the updating of it,
    • supply of images, text and information, and making databases available,
    • supply of music, films and games, including games of chance and gambling games and of political, cultural, artistic, sporting, scientific and entertainment broadcasts and events,
    • supply of distance teaching.

Further information is available in the information leaflet on Foreign suppliers doing business in Ireland on the Revenue website.

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Do I have to pay VAT on goods imported from outside the E.U.?

When talking in VAT terms, imports are goods arriving into Ireland from non-EU countries. Goods arriving from other Member States of the E.U. are called intra-Community acquisitions.

As a general rule, imported goods are liable to VAT and customs' duties at the point of arrival in the country. Revenue Customs will collect both the VAT and the duty before the goods will be released. If you are registered for VAT, and are bringing the goods in for business purposes, then you can claim back the VAT in your next VAT3 Return. VAT is charged on imports at the same rate that applies to the sale of similar goods in the state.

It should be noted that where goods are imported into the state for onward consignment or transhipment to another member state, no VAT is charged on these goods provided that they do not enter free circulation in Ireland.

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I am a foreign trader, and I want to keep stock in a warehouse in Ireland for drawdown by customers as required. Do I have to register for VAT in Ireland?

No...subject to certain conditions. Where a non-established trader who is registered in another Member State dispatches goods to Ireland there are generally two possible VAT consequences – if the non-established trader retains ownership of the goods he/she is obliged to register for Vat in Ireland; if not, the customers must account for the VAT on the intra-Community acquisition of the goods.

However, Section 3(8) of the VAT Act 1972 (as amended) provides for a situation where goods are dispatched to the State and held in storage pending purchase by customers. Once certain conditions are adhered to, the non-established supplier is not required to register for VAT in Ireland, and the intra-Community acquisition by the customers is deferred until such time as the goods are actually retrieved by the customer from storage.

The conditions are:

  • The keeper of the warehouse etc. where the stock is stored is not an employee or agent of the foreign supplier.
  • The supplier is a taxable person not established in the State.
  • The supplier has not exercised an option to register for VAT in the State.
  • The persons to whom the supply is made (the consignees) are registered for VAT in the State.
  • The consignees are regular customers of the supplier.
  • The stock is always drawn down within three months of arrival.

In this situation, the Intra-Community Acquisition is deemed to occur at the time when the stock is drawn down, and must be accounted for by the consignee(s) at that time.

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