VAT
VAT us a tax on consumer spending. It is the final consumer who is not registered for VAT who pays VAT as part of the price.
Registration
A taxable has to register for VAT in the following circumstances:
• €35,000 -Mail order or distance selling into the state.
• €37,500 -Supplying services.
• €41,000 -Making acquisitions among EU member states.
• €75,000 -Supplying goods not made up of more than 10% services.
*Note the actual turnover may be reduced by the VAT on purchases. To register for VAT you need to fill out a form TR1 or TR2.
Returns
Then return should be made on a VAT 3 form and returned on the 19th day of the following month of the period. If the amount paid is insufficient and the outstanding balance is more than 20% interest will be charged. Late payment of VAT are subject to 0.0322% per day.
Supply of Goods
VAT becomes due when the supply of goods or services has taken place. This includes:
• Transfer of ownership of goods by agreement
• Sales of moveable goods on commisson
• Handing over of immovable goods
• Gifts of taxable goods €20 or more exclusing VAT
• Seizure of goods by a sheriff
For a complete list see http://www.revenue.ie
Supply of Services
For VAT purposes a service is anything which isn’t a good eg:
• Services of accountancy, web development, plumber etc
• Hiring or leasing of goods
• Refraning from doing something
Place of Services
Services supplied outside the state are not liable to Irish VAT. Howver special rules apply to the following:
• Property
• Transport and related ancillary services
• Forth schedule or received services.
• Deductible VAT
• VAT charged on goods and services
• VAT on inputs
• VAT payable on self-supply
Non-Deductible VAT
• Provison of food, drink, accommodation to taxable person, his agent or his employees except when the provision represents a taxable supply by the taxable person.
• Entertainment expenses incurred by the taxable person
• Acquisition, hiring or leasing of motor veichles except when they are stock in trade or the business consists of hiring motor vechicles or for use in a driving school.
• Purchase of petrol otherwise as stock in trade.
The above information was taken from CA Prof 1 “Taxtation” 2008-2009 ICAI
Audit Exempt
A limited company may claim an audit exemption in the following circumstances:
• Less than €7.3 million turnover
• Less than €3.65 in assets and the end of the financial year
• Average number of employees must no exceed 50
• Must not be a parent company or subsidiary.
For a full list of the requirements please see the CRO website.
If the company meets the CRO criteria its accounts need to consist of a balance sheet and notes where applicable. Also there must be an exemption statement on the balance sheet. This can be found here.
If you fail to file your annual return on time you will not only loose you audit exemption for the current year but you will also loose your audit exemption for the next year. You will incur late fees but you will also be required to have your accounts audited. A late cro annual return can be very costly.
http://www.soi.ie
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