Recent updates from Irish Revenue and EU Commission | Indirect Tax Matters May 2020
Irish Revenue Updates
Revenue eBrief No. 030/20 - 07 February 2020
Tax treatment of income arising from the provision of short-term accommodation
Tax and Duty manual Part 04-01-20 has been updated to reflect the VAT rate change from 9% to 13.5% in relation to short term accommodation as introduced in Finance Act 2018.
Revenue eBrief No. 046/20 - 23 March 2020
Advice and information to assist taxpayers and their agents during the COVID-19 pandemic
The following advice and information is available on Revenue's website to assist taxpayers, and their agents, during the COVID-19 pandemic:
- Continuity of Revenue services during the COVID-19 pandemic
- Guidance for employers and employees regarding compliance with certain reporting and filing obligations and the satisfaction of certain other tax related conditions
- Corporation Tax and presence in the State or outside the State resulting from COVID-related travel restrictions
- Relief from Excise Duty (Alcohol Products Tax) for the manufacture of hand sanitiser products.
Revenue eBrief No. 053/20 - 31 March 2020
The VAT Tax and Duty Manual has been updated to include a new chapter detailing the VAT treatment of VAT Groups.
In addition, the VAT TDM Index has been archived as it is no longer relevant. The Index, which was created in June 2017 following the restructuring of the VAT Tax and Duty Manual, listed the subjects covered in the manual and indicated the previous location of the content (VAT Leaflet or a VAT TDM).
Revenue update advice to SMEs experiencing cashflow difficulties arising from COVID-19
On 13 March 2020, Revenue outlined some key advice and actions it had taken to assist small and medium enterprise businesses (SMEs)  experiencing cashflow and trading difficulties arising from the impacts of COVID-19.
An SME is regarded as a business with turnover of less than €3 million who is not dealt with by either Revenue’ Large Corporates Division or Medium Enterprises Division. SMEs are managed from both a service and compliance standpoint by Revenue’s Business Division
On 02/04/2020 Revenue updated this advice as follows:
Tax Returns: Businesses experiencing temporary cashflow difficulties should continue to send in tax returns on time, even where payment is not immediately possible. Where key personnel are unavailable to compute the tax returns due to the COVID-19 virus, businesses should still file on a ‘best estimates’ basis. Any subsequent amendments can be completed on a self-correction basis without penalty.
Interest: The charging of interest on late payments is suspended for March/April VAT and April PAYE (Employers) liabilities.
This is in addition to the earlier announcement that the charging of interest on late payments is suspended for January/February VAT and both February and March PAYE (Employers) liabilities.
Debt Enforcement: All debt enforcement activity remains suspended until further notice.
Tax Clearance: Current Tax Clearance status will remain in place for all businesses over the coming months.
Revenue has stated that it understands the unprecedented situation facing businesses at this time. Revenue have provided extensive guidance and advice on their COVID-19 information webpages to assist taxpayers and agents, experiencing a range of difficulties caused by the impacts of the COVID-19 virus.
Revenue also state that they are doing everything possible to ease the cashflow burdens for businesses during the crisis. They continue to prioritise the approval and processing of repayments and refunds and to minimise delays for businesses in receiving moneys due. Other measures in place include:
- Payment of PSWT interim refunds on the basis of a written statement issued by the accountable person where the relevant F45 form cannot be issued to the specified person due solely to the current Covid-19 circumstances
- Expedited payment of any instalment of excess R&D tax credit that is due to be paid in 2020. Further information on these measures can be found on Revenue’s website.
Revenue is also assisting businesses other than SMEs who are experiencing temporary cash flow or trading difficulties, including larger businesses managed by Large Corporates Division (LCD) and Medium Enterprise Division (MED).
Revenue will continue to closely monitor the evolving situation regarding COVID-19 and will issue further updated guidance for businesses when required.
Revenue eBrief No. 060/20 - 08 April 2020
Vehicle Registration Tax - Valuation System for New and Used Vehicles
VRT Manual Section 8 has been updated to reflect changes introduced by Finance Act 2019. Changes to the manual include:
- Updated calculations incorporating the Nitrogen Oxide Charge
- Updated Depreciation Tables
- Updated Sample Forms
Revenue eBrief No. 063/20 - 17 April 2020
Temporary VAT zero rating of supplies of personal protective equipment, ventilators and other medical products
This eBrief is an important notice for taxpayers and agents regarding the temporary VAT zero rating of supplies of personal protection equipment, ventilators and other medical products when supplied to the HSE, hospitals, nursing homes, and other healthcare facilities for use in the delivery of Covid-19 related health care services to their patients.
This concessional tax treatment will apply from 9 April 2020 up to 31 July 2020, subject to review.
Revenue eBrief No. 077/20 - 06 May 2020
The application of the Capital Goods Scheme and the VAT treatment of Donations or Gifts of goods or meals
The guidance note ‘Temporary zero rating of supplies of medical equipment for the treatment of patients with Covid-19’ has been updated.
The application of the Capital Goods Scheme relating to the supply of emergency accommodation and the VAT treatment of donations or gifts of goods or meals supplied in the response to the Covid-19 crisis are set out in the guidance note.
EU Commission updates
The EU Commission waives customs duties and VAT on the import of medical equipment from third countries in the fight against the Coronavirus
The EU Commission has introduced measures to temporarily waive customs duties and VAT on the import of medical devices and personal protective equipment (PPE) from outside the EU. The measures aim to lower the cost of medical equipment so that they are more accessible to doctors, nurses and patients during the current Covid-19 pandemic.
The measure includes masks and protective equipment, as well as testing kits, ventilators and other medical equipment. It will apply for a period of 6 months, with a possibility for further extension. The exemption applies retroactively from 30 January 2020.
A list of the goods which can be imported VAT and duty free are listed here.
The Commission has also published a Q&A in relation to the waiver of VAT on medical devices and PPE which provides additional detail around the measures.
The Commission adopts an Action Plan to the combat Money Laundering and Terrorist Financing – 12 additional countries considered “high-risk”
The Commission has proposed a series of measures designed to further strengthen the EU's framework to fight against money laundering and terrorist financing including publishing an Action Plan and clarifying the methodology used to identify high-risk third countries.
The Commission has added 12 countries to its high risk list: The Bahamas, Barbados, Botswana, Cambodia, Ghana, Jamaica, Mauritius, Mongolia, Myanmar, Nicaragua, Panama and Zimbabwe.
Six countries have been removed from the list – Bosnia-Herzegovina, Guyana, Lao People's Democratic Republic, Ethiopia, Sri Lanka and Tunisia
Authorities, stakeholders and citizens have until 29 July to provide their feedback on the proposals.
E-commerce: Council adopts new rules for exchange of VAT payment data to apply from 1st January 2024
The Council has adopted new rules to assist in the detection of VAT fraud in cross-border e-commerce transactions. The new measures will come into effect on 1st January 2024.
The new rules consisted of amendments to the VAT directive putting in place requirements on payment service providers to keep records of cross-border payments related to e-commerce. This data will then be made available to national tax authorities under strict conditions, including those related to data protection.
Amendments were also made to a regulation on administrative cooperation in the area of VAT. These amendments set out the details of how national tax authorities will cooperate in this area to detect VAT fraud and control compliance with VAT obligations.
The texts complement the VAT regulatory framework for e-commerce coming into force in January 2021 which introduced new VAT obligations for online marketplaces and simplified VAT compliance rules for online businesses.