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Acquisitions from other EU Member States

  1. Overview
  2. Self accounting for VAT
  3. What information on your ICAs must you submit to Revenue?
  4. When are you required to register to account for ICAs?
  5. What are VIES and Intrastat?
  6. ICAs of alcohol products
  7. Acquisitions of new means of transport from another Member State

Self accounting for VAT

Under intra-Community acquisition rules the purchaser is required to self account on a reverse charge basis. This means that the business customer has to account for the Value-Added Tax (VAT) on the purchase of the goods from the other Member State.

The supplier in the other Member State is considered to have made an intra-Community supply.

Under this system:

  • the supply is zero-rated in the Member State of dispatch as an intra-Community supply
  • the purchaser is liable for VAT on the acquisition of the goods
  • the purchaser must account for the VAT in their VAT return for the period in which the acquisition took place at the rate of VAT applicable in their own Member State
  • if they are entitled to an input credit  for the VAT payable on the intra-Community acquisition this is reclaimed in the same VAT return
    and
  • the purchaser must account for VAT on any subsequent supply of the goods in the appropriate VAT return.
  • Example

    A trader in Ireland purchases goods in January 2016 costing €5,000 from a company in Germany. The goods were purchased for the purposes of their taxable supplies. The German company does not charge VAT on the intra-Community supply to Ireland as the conditions for the zero rate in Germany have been met.

    The Irish trader must charge themselves VAT at the rate applicable in Ireland, for example VAT of €1,150 (5,000 at 23%) at the standard rate. However, the Irish trader can claim an input credit of €1,150 as the goods were purchased for their taxable supplies, assuming the purchase is deductible for VAT purposes.

    Two taxable events have occurred:

    1) the intra-Community supply at the zero rate for which the supplier in Germany is responsible

    2) the intra-Community acquisition at the appropriate rate in Ireland for which the purchaser is responsible.

    Irish trader’s VAT 3 return January/February 2016
    Type of VAT liabilityTotal deductible
    T1 (VAT on sales) €1,150
    T2 (VAT on purchases) €1,150
    T3 (VAT payable) Nil
    T4 (VAT repayable) Nil
    E1 (value of goods sent to other EU countries) Nil
    E2 (value of goods received from other EU countries) €5,000

    When the Irish trader sells the goods on, VAT is chargeable to their customers at 23% and paid over to Revenue in the relevant VAT returns in the normal course.

Next: What information on your ICAs must you submit to Revenue?

Published: 05 October 2017 Print this page

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