If your sales are in excess of €37,500 per year if you provide services, or €75,000 per year if you provide goods, then you will need to register for VAT in Ireland. Once registered for VAT, the business will add VAT to the sales price of its goods and/or services. The rates of VAT are the standard rate (23%) or reduced rate (13.5%) and Zero Rated (0%). There are also low rates for Flat Rate Farmers.
If your sales (turnover) does not exceed the thresholds, there is no obligation to register. However, it may be beneficial to some businesses to register anyway. The advantage to registering for VAT is that you can claim back the VAT expense on inputs – for example on materials purchased, services required and items such as diesel and equipment. An important point to note is that. A business which elected to register for VAT may cancel registration by arrangement with Revenue. However, it can result in a VAT liability. Any excess of VAT refunded over VAT paid during the 3 years prior to the cancellation (or the period of election if less) must be repaid to the Revenue.If turnover goes below the threshold, a business may also cancel VAT registration. A clawback will not occur as long as the business didn’t initially elect to register for VAT. Therefore the decision to elect to be Vat registered must be taken carefully.
Similar to registering for income tax, registration for VAT con be done online through ROS or manually using a TR1 form. Vat registration can sometimes take longer than Income Tax registration as Revenue Commissioners have commenced seeking additional details prior to completing the registration, such evidence of trading, lease agreements for premises etc.
When you register for VAT, you will receive a VAT number. VAT registered persons are obliged to file returns on or before the 23rd of the month following the period end. The VAT period is generally bimonthly, quarterly, and annually or biannually.
VAT registration may also be required in respect of the acquisition of goods from other European Union (EU) Member States, or services received from abroad.
Information on how to register for VAT in Ireland is outlined here on the revenue website
We can advise you on if electing to be Vat registered would be beneficial for your business and some common pitfalls as well as help you with the registration process. For further information please email email@example.com