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Indirect Tax Matters Newsletter | May 2020

COVID-19 (C19) took most of us by complete surprise. Although the full impact of the pandemic on our organisations, economies and communities will not be known for some time, we can be certain that now, more than ever, keeping people safe, continuing to serve customers and clients well and securing financial survival will require strong and effective governance and leadership. Therefore it should not be surprising that in this edition of Indirect Tax Matters, we provide you with Deloitte commentary on topical Indirect Tax issues including articles on responding & recovery from an Indirect Tax perspective which we hope you find insightful.

Our last edition contained an article on the new EU VAT rules coming into force next year which are referred to as the VAT e-commerce package (a.k.a. the digital economy) and will significantly expand the scope of the MOSS scheme. The scope of transactions that will have to be reported through the EU MOSS scheme will be increased to include not just TBE services, but also other B2C services and B2C supplies of goods. On 8 May 2020, because of the practical difficulties created by the lockdown measures taken to contain the coronavirus pandemic, the Commission proposed to postpone the introduction of new e-commerce VAT rules by six months. Once adopted by the Council, the rules will apply as of 1 July 2021 instead of 1 January 2021, giving Member States and businesses enough time to prepare.

Our Indirect Tax team in Deloitte Ireland are acutely aware of the complex issues challenging businesses domestically and globally. Indirect Tax Matters is designed to provide insights to assist you in meeting those ever evolving challenges.

1. Changes to ROS, the VAT Return and COVID-19 Measures

Our first article by Jane Hallinan and Richard Concannon highlights changes to the Revenue Online Service and how a change in registration status may provide a cash flow benefit. It also examines the COVID-19 Tax Warehousing relief that many businesses are likely to avail of as they navigate these challenging times.

2. Maximise cash flow through VAT opportunities

There are several VAT processes and procedures which can be used by businesses to gain cash flow improvements. Ciara McMullin highlights how these simple strategies that may provide a significant boost to cash flow during these unprecedented times can be appropriately implemented. Businesses should consider if now is an opportune time to review VAT processes, procedures, the treatment applied to transactions and of course historic VAT filings, amongst other aspects. We have numerous methodologies for assisting various businesses in carrying out these reviews.

3. Hire Purchase & Personal Contract Plans: VAT Treatment & Defaults

This article by Richard McDaid and Corra Travers explains the VAT treatment of HP and PCPs and provides a high level overview of some of the implications of default and repossessions of cars under HP or PCP agreements. 

4. Investment Management Services – CJEU update

Suzanne Tierney considers the Advocate General’s Opinion in the Blackrock Investment Management (UK) Ltd case where the AG opined that a single supply of management services to a third party fund management company, which manages both special investment funds and other funds, should be subject to a single rate of tax and does not fall within the scope of the exemption for special investment funds – will the court come to the same conclusion?

5. Is Brexit on track?

Ray Campbell, one of our customs experts is keeping a close eye on Brexit developments and looks at the current state of play for Brexit negotiations and preparation, is it now time to seek an extension to the deadlines.

6. Customs Duty reduction strategies and COVID measures

The European Commission (EC) and Member States customs authorities have put certain measures into place to help facilitate the movement of goods. Donna Hemphill walks us through the EU and Irish measures to ensure medical equipment and other essential goods can move without restrictions and additional costs.

7. Recent Irish and Court of Justice of the European Union Cases 

Learn how CJEU cases could potentially impact your business with our brief synapsis of some of the more recent decisions.

8. Irish Revenue Updates

Discover our insights as we reflect on ‘ebriefs’ and guidance notes issued by the Irish Revenue Commissioners on Indirect Tax issues.

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