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Value Added Tax
The VAT registration thresholds for businesses is €37,500 for the supply of services and €75,000 for the supply of goods. There was no change in the recent budget.
Cash Basis
For businesses with a yearly liability of between €3,001 and €14,000, VAT returns will only be required to be made three times a year. For businesses with a yearly liability of €3,000 or less, VAT returns will only be required to be made twice per year.
Standard Rate | 21% |
Reduced Rates | 13.5% |
Livestock (no change) | 4.8% |
Under the normal Invoice Basis for accounting, a trader is liable to account for VAT when an invoice is issued to a customer. Under the Cash Basis (also called the Receipts or Moneys Received Basis) of accounting, a trader is liable to account for VAT when payment is actually received.
A trader must fulfill one of two criteria to be on the Cash Basis. Either
- Annual turnover does not exceed one million €; or
- Supplies are almost exclusively (at least 90%) made to customers who are not registered for VAT, or are not entitled to claim a full deduction of VAT.
Introduction of VAT Margin Scheme for second-hand cars
A Margin Scheme is being introduced whereby, with effect from 1 July 2009, dealers will be taxed on their margin in regard to second-hand cars they acquire and resell after that date. Second-hand cars acquired before 1 July 2009 and resold after that date will be taxed on their resale price. However, where such a second-hand car is resold before the 31 Decemeber 2009, the payment of the VAT due on the resale price of the car may be spread in equal amounts over the following 3 VAT periods.
Should you require any further information, please contact Susan Lennon.
Email: slennon@annebrady.ie
