Where is your company based?
VAT-registered businesses in an EU member state are eligible to recover VAT on business costs from A VAT Refund Ireland Guide under the EU VAT Refund Directive.
VAT-registered businesses outside of the European Union are eligible to recover VAT on business costs from A VAT Refund Ireland Guide under the 13th Directive.
Ireland’s VAT Rates:
The Republic of Ireland first introduced a value added tax or VAT directive on November 1, 1972, shortly before becoming a member state of the European Union. Ireland established its VAT rate at 16.37%, slightly above the EU’s minimum standard rate of 15%.
Since its inception, Ireland’s standard rate has risen and fallen more than a dozen times, reaching as high as 35% in the 1980s. These days, the standard rate remains relatively consistent, though this EU country continues to make minor adjustments to its VAT categories—sometimes as frequently as twice per year. The current standard rate of 23% ranks among the highest in the EU VAT rates today.
Current Rates in Ireland
Ireland separates its VAT rates into five distinct categories:
- Standard rate (23%) – Most goods and services, including furniture, vehicles, and legal services, are taxed at the standard rate.
- Reduced rate (13.5%) – Reduced rate products and services include certain building services, fuels, photographic supplies, and cleaning and maintenance services, as well as tour guide services, the supply of horses and greyhounds, and the importation of some antiques and artwork.
- Second reduced rate (9%) – Items like newspapers, periodicals, and some eBooks fall under this reduced rate. Until February 2023, the second reduced VAT rate will also cover admission to cultural events, hairdressing services, and hot takeaway foods.
- Livestock rate (4.8%) – This ultra-reduced VAT rate applies to livestock destined for food preparation and certain agricultural supplies.
- Zero rate (0.0%) – This final VAT-free category includes essentials like children’s clothing and diapers, certain food products, certain medicines, books, and educational services.
Additionally, there is a 5.5% flat-rate compensation percentage for farmers whose annual turnover sits below the designated threshold.
How to Pay Your VAT Bill in Ireland
The following payment methods are accepted:
- ROS Debit Instruction
- Single Debit Instruction
- Credit or debit card (only if Revenue manages your tax affairs)
Ireland has six 2-month taxable periods that begin on the 1st of January, March, May, July, September, and November. You must submit your value added tax or VAT payments on the 19th of the month that follows the end of a taxable period (though if you file via ROS, you have until the 23rd). While making six returns per year is standard, you may also be eligible for quarterly, bi-annual, or annual payments, depending on your liability and payment methods.
Ireland VAT Compliance
To comply with Ireland’s VAT rules and regulations and receive repayments (if due), you must keep accurate and up-to-date records of everything VAT-related for at least six years, including:
- Credit and debit notes
- Accounting books and records
- Bank statements
- Cash register tallies
Furthermore, your submissions must remain in the form they were issued. For example, if you issue paper invoices, you must retain them in paper form. You are also required to use approved foreign exchange rates.
If you have questions regarding submitting a VAT refund, Ireland compliance laws, reporting requirements, or VAT in general, VAT IT is here to help. Contact us today for more information.
Revenue. Historical VAT Rates. https://www.revenue.ie/en/vat/vat-rates/historical-vat-rates/index.aspx
Revenue. Current VAT Rates. https://www.revenue.ie/en/vat/vat-rates/search-vat-rates/current-vat-rates.aspx
Revenue. Payment services guides. https://www.revenue.ie/en/online-services/support/help-guides/ros/payment-services-guides.aspx
Revenue. How to account for VAT. https://www.revenue.ie/en/vat/accounting-for-vat/how-to-account-for-value-added-tax/when-vat-becomes-payable.aspx
Revenue. VAT records to be kept. https://www.revenue.ie/en/vat/vat-records-invoices-credit-notes/vat-records-to-be-kept/index.aspx