Distance sales occur when goods are dispatched or transported to a private consumer (not VAT registered) in another European Union (EU) Member State, and the supplier is responsible for the delivery of the goods.
- mail order sales
- phone or tele-sales
- physical goods ordered over the internet.
It does not include sales of new means of transport or excisable goods. Digitised goods are considered to be services (goods that are downloaded via the internet).
Distance sales to Ireland
You are required to register and account for VAT in this State when your distance sales to Ireland exceed €35,000 in the calendar year. However, you may opt to register and account for Value-Added Tax (VAT) on your distance sales even if the threshold is not exceeded.
- Example 1
A VAT registered United Kingdom (UK) trader supplies goods by means of mail order to private individuals in the State. If the UK trader sells goods by mail order of more than €35,000 in a calendar year to private individuals in the State, the place of supply is Ireland, where the transportation ends. The UK trader is obliged to register for VAT in the State and to account for Irish VAT on the goods.
Distance sales from Ireland
If you are making distance sales to private consumers in another EU Member State, you must charge Irish VAT until your sales reach the relevant threshold in that Member State. This VAT must be included in the T1 sales on your VAT 3 return.
If your distance sales exceed the appropriate threshold in an EU Member State, you must:
- register for VAT in that Member State
- account for VAT at the appropriate rates in that Member State
- include the value of the goods in the E1 box on your Irish VAT 3 return.
If you are engaged in distance sales to several Member States, you are required to register for VAT in each Member State in which your sales exceed the appropriate threshold limits.
You may opt to register for VAT and account for VAT at the appropriate rates on your distance sales in another Member State, even if the appropriate threshold limit is not exceeded. You should contact the authorities of the Member State concerned, who will provide details of the requirements for registration. Member State contact details.
Further guidance contains more detailed information on the VAT treatment of distance sales.
- Example 2
VAT registered Irish trader supplies goods by means of mail order to private individuals in the UK. If your distance sales to private individuals in the UK are below the UK registration threshold of €100,000 and you have not elected to register for VAT in the UK, you must charge Irish VAT on the goods, where the transportation begins.