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Our view on recent updates from Irish Revenue and EU Commission

Indirect Tax Matters September 2021

Revenue eBrief No. 101/21 - 14 May 2021

ePSWT implementation

This manual provides guidance on the online electronic Professional Services Withholding Tax (ePSWT) system, which is in operation from 1 July 2021.

At a high level, when an accountable person (e.g. a public service body) makes a relevant payment for professional services to a specified person (service provider):

  • PSWT at a rate of 20% is deducted from the payment and remitted to Revenue,
  • the balance of 80% is paid to the specified person, and
  • the accountable person enters details of the payment on the new ePSWT system on ROS

The guidance addresses queries arising from accountable and specified persons, and their representatives, about the then planned changes.

Revenue had previously written to accountable persons and specified persons about ePSWT and the planned changes in March and May 2021, respectively.

Revenue eBrief No 109/21 - 26 May 2021

Charities VAT Compensation Scheme - reminder of closing date for submission of claims

The Charities VAT Compensation Scheme aims to reduce the VAT burden on charities and to partially compensate them for VAT paid in the day to day running of their organisations.

The reminder issued to notify charities that the closing date for submission of claims for the VAT Compensation Scheme was 30 June 2021. It is not possible for claims to be submitted after that date.

Information about the scheme is available on the Revenue website.

Revenue eBrief No. 111/21 - 02 June 2021

Guide to Economic Operators Registration Identification registration in ROS (EORI Registration)

We welcome a new Tax and Duty Manual eReg EORI Guide which explains the online registration process, using Revenue’s Online Service (ROS), for customers or their agents who require a Customs and Excise (C&E) and/or an Economic Operators Registration Identification (EORI) registration number in connection with Import/Export activity.

If you trade with a non-EU country, you will need a unique Economic Operators Registration and Identification (EORI) number.

Revenue eBrief No. 119/21 - 18 June 2021

Customs treatment of gifts and items of negligible value

The manual regarding the Customs Treatment of Gifts and Items of Negligible Value has been updated. From 1 July 2021 import VAT will be payable on all goods entering the EU irrespective of their value and will always be collected irrespective of the amount due. Before that date, consignments with a custom’s value below €22 did not attract VAT.

Revenue eBrief No. 130/21 - 01 July 2021

Customs Manual on Import VAT

The Customs Manual on Import VAT has been updated in relation to changes arising due to the introduction of new eCommerce rules effective from 1 July 2021.

In accordance with the Value-Added Tax Consolidation Act 2010 VAT is, broadly, payable on

  1. the supply of goods and services effected within the State for consideration by a taxable person in the course or furtherance of business.
  2. on the Intra-Community acquisition of goods effected within the State for consideration by a taxable person; and
  3. on goods imported into the State from outside the European Union.

The Customs Manual on Import VAT deals with the situation at (c) above and gives a general overview of the arrangements in place in relation to VAT payable on goods imported into the State from outside the EU (usually referred to as “Import VAT”).

AIS Changes

Since 23 November 2020, AEP for imports was replaced by Revenue’s Automated Import System (AIS). Further information can be found in the Automated Import System (AIS) section on the Revenue website. The majority of import procedures will not change. Further details can be found in the AIS trader guide also available on the Revenue website.

New VAT rules for goods bought from non-EU countries come into effect

A reminder from Revenue to online shoppers of new VAT rules that came into effect on 1 July 2021 for goods arriving into Ireland from non-European Union (EU) countries.

On 30/6/2021, Ms Maureen Dalton, Principal Officer in Revenue’s Customs Division, confirmed that, from 01/07/21, all goods arriving into Ireland from non-EU countries, regardless of their value, will be subject to VAT:

In recognition of the VAT rule changes, a special scheme called the Import One Stop Shop (IOSS) which came into operation from 01/07/21 which allows suppliers to pay the VAT on behalf of consumers. The use of IOSS is not mandatory, however, it provides suppliers with a significantly simplified method for declaring and paying import VAT on low value consignments. If the supplier is operating under the IOSS this will be reflected in the ‘terms and conditions’ at the time of checkout and the total price paid for the goods at the time of purchase will include any Irish VAT due.

Revenue Update: 6 months post-Brexit

Revenue issued an update on 1 July 2021 which marked 6 months on from the UK’s departure from the EU. It provided key information and insights into the very different trading environment between Ireland and Great Britain.

Mr Gerry Harrahill, Revenue Commissioner and Director General of Customs, acknowledged that businesses have made enormous progress in adapting to the new requirements in the last 6 months, with many now successfully trading with or through Great Britain or changing their supply chains or supply routes so as to eliminate the need for compliance with customs and other regulatory formalities.

Building on the significant engagement with businesses in the lead up to 1 January 2021, over the past 6 months Revenue has continued to engage with and support businesses, large and small, in overcoming the challenges and adapting to the new requirements arising as a result of Brexit. In addition to regular stakeholder meetings with ferry operators, hauliers and the Retail Forum, Revenue has participated in a number of trade webinar events since the start of January, providing key information and practical advice to over 6,600 attendees.

While many businesses have made enormous progress in adapting to the new requirements in the last six months, Revenue is aware that some businesses continue to be challenged in adapting to the need to comply with customs and other regulatory formalities.

Businesses are reminded that Revenue’s Customs helpline can be contacted on 01 7383685. Additionally, a range of Government supports are available, including training and grants, to help businesses deal with these changes.

Revenue eBrief No. 132/21 - 05 July 2021

VAT Treatment of Intra-Community Distance Sales of Goods

A new Tax and Duty Manual (TDM) VAT Treatment of Intra-Community Distance Sales of Goods has been published to incorporate the new eCommerce rules effective from 1 July 2021.

This welcome guidance sets out the VAT treatment of intra-Community distance sales of goods with effect from 1 July 2021 in accordance with the new eCommerce legislation.

At a high level, an intra-Community distance sale of goods occurs when goods are dispatched or transported by or on behalf of a supplier, including where the supplier intervenes indirectly in the dispatch or transport of the goods, in one EU Member State to certain customers in another Member State. This includes mail order sales, phone or tele-sales or physical goods ordered over the internet. It does not include new means of transport or goods supplied after assembly or installation

The TDM Telecommunications, Broadcasting and Electronic (TBE) Services has been published to consolidate and update information which was previously provided elsewhere on the Revenue website.

This guidance sets out the Value Added Tax (VAT) treatment of supplies of telecommunications, broadcasting and electronic (TBE) services from a VAT registered person to a customer. The place of taxation will be determined by the location of the supplier, the customer, and the business to consumer (B2C) €10,000 place of supply threshold.

The TDM VAT Treatment of eGaming Services has also been updated.

An electronically supplied service is one which is “delivered over the Internet or an electronic network and the nature of which renders its supply essentially automated and involving minimal human intervention, and impossible to ensure in the absence of information technology”. The VAT Directive and Council Implementing Regulations 282/2011/EU provide that the supply of games including games of chance “eGaming” delivered over the internet or an electronic network are regarded as electronically supplied services “eServices”.

“Gaming” means playing a game (whether of skill or chance or partly of skill and partly of chance) for stakes hazarded by the players. This contrasts with bets on the outcome of sports events. The tax treatment of eGaming services to consumers is determined by the place where the consumer is established, has a permanent address or usually resides. eGaming services are exempt without deductibility in some Member States but are taxable in Ireland at the standard rate.

Revenue eBrief No. 143/21 - 27 July 2021

Import One Stop Shop (IOSS) - registration procedure and reporting obligations for intermediaries

Another topical update to The Import One Stop Shop (IOSS) Tax and Duty Manual. The manual has been updated to clarify the registration procedure and reporting obligations for intermediaries under the new VAT eCommerce rules introduced on 1 July 2021.

As advised previously, prior to 1 July 2021, low value goods with a value less than €22 were exempt from VAT on importation into the EU. On 1 July 2021 this exemption was abolished and VAT became chargeable on all imports, including those with a value of less than €22. The exemption from customs duty for imports of goods with an intrinsic value of less than €150 remains in place. As a result, VAT is due on the import of all goods, while customs duties are charged only on goods with an intrinsic value of more than €150, except in the case of goods subject to excise duty.

Revenue eBrief No. 145/21 - 28 July 2021

Full self-assessment - time limits for making enquiries and making or amending assessments

This manual outlines the right of Revenue officers to make enquiries, and the time limits for making such inquiries

Tax and Duty Manual - Full Self-Assessment: Time limits for making enquiries and raising assessments - is amended in Paragraph 4:

  • to clarify the circumstances where assessments can be amended
  • to confirm that assessments can be made or amended outside the four-year timeframe on conclusion of a Mutual Agreement Procedure, as provided for in section 959AA(2A) Taxes Consolidation Act 1997.

Revenue eBrief No. 150/21 - 31 July 2021

Guidelines for VAT Registration

This manual outlines the process for approval of Value Added Tax (VAT) registration applications, whether received electronically or on paper. It has been updated to reflect enhancements that enable VAT applicants to apply for Postponed Accounting through the eRegistration system or on the Form TR1, TR2, TR1 (FT), or TR2 (FT).

Revenue eBrief No. 151/21 - 03 August 2021

Administration and Control of Tax Warehouses Manual (Part 2 Breweries, Microbreweries and Cider Manufacturers)

Revenue’s Administration & Control of Tax Warehouses Manual is a three-part manual issued for the information and guidance of Revenue Officers with responsibility for the administration, control and audit of authorised warehouse keepers and approved tax warehouses.

Section 2 of the Administration and Control of Tax Warehouses Manual - (Part 2 Breweries, Micro-breweries and Cider Manufacturers) has been updated.

This update reflects the extension of the relief from Alcohol Products Tax under Section 78A Finance Act 2003 to include qualifying beer produced by micro-breweries located in 3rd countries and imported into the State.

Revenue eBrief No. 155/21 - 05 August 2021

Customs Temporary Admission Procedure

The Customs Temporary Admission Manual has been amended to include further information on the process of applying for authorisation on the Customs Decisions System (CDS).

To summarise, when goods are imported into, or received in Ireland, from a country outside the European Union (EU) they are liable to import charges (Customs Duty, Anti-Dumping, Countervailing and Excise Duties where applicable, and VAT) at the point of importation. However, in the case of certain goods, which are imported temporarily, exemption or partial relief is available from these charges. Eligibility for Temporary Admission relief is based on the type of goods concerned and their use before they are re-exported. Conditions on ownership may also apply. Temporary Admission cannot be used to import goods to process or repair them. However, repairs and maintenance to preserve the goods or keep them in working order for their use under the procedure are possible. The Customs Temporary Admissions Manual outlines the relief available, how that relief may be obtained and the customs procedures involved.

EU commission updates

VAT: New e-commerce rules in the EU will simplify life for traders and introduce more transparency for consumers – 28 June 2021

New VAT rules came into force on 1 July that will mainly affect online sellers and marketplaces/platforms both inside and outside the EU. Previously, e-commerce sellers needed to have a VAT registration in each Member State in which they had a turnover above a certain threshold which varied from country to country. From 1 July, this was replaced with a single EU threshold of €10,000 above which VAT must be paid in the Member States where the goods are delivered. Online sellers may also now register for an electronic portal called the “One Stop Shop” where they can take care of all of their VAT obligations for their sales across the EU. Furthermore, the introduction of an Import One Stop Shop for non-EU sellers will allow them to register easily for VAT in the EU, and will ensure that the correct amount of VAT makes its way to the Member State in which it is finally due. Finally, the exemption for goods being imported into the EU with a value of less than €22 has been lifted so that VAT is now charged on all goods entering the EU. Studies have shown that this exemption had been abused with some sellers from outside the EU labelling consignment of goods e.g. smartphones, with other descriptions, in order to benefit from the exemption.

https://ec.europa.eu/commission/presscorner/detail/en/ip_21_3098

Customs: EU proposes World Customs Organization modernisation in support of a strengthened multilateral order - 24 June 2021

The Commission presented an initiative for broad reform of the World Customs Organization (WCO) to WCO Members at the WCO Council Session on the 24th of June 2021. The modernization initiative put forward involves a three-step approach towards strategic reform. Firstly, the Commission recommends that the WCO should have greater focus on strategic priorities such as digitalisation of customs and the use of data. Secondly, it was recommended that the governance methods at the WCO should be further addressed so that the Organization can play its full role in a dynamic international environment. Thirdly, it was recommended that the means by which the WCO is funded should be examined to ensure long-term sustainability of the Organization to improve its standing in the global multilateral architecture, especially in the wake of the COVID-19 pandemic and as part of the economic recovery.

https://ec.europa.eu/commission/presscorner/detail/%5Beuropa_tokens:europa_interface_language%5D/ip_21_3144

Revision of the Energy Taxation Directive (ETD): Questions and Answers – 14 July 2021


The EU’s Energy Taxation Directive (ETD) entered into force in 2003 and lays down the structural rules and minimum excise duty rates for the taxation of energy products used as motor fuel, heating fuel, and electricity. Individual Member states are free to set their own rates as long as those minimum rates are respected. However, the Commission has concluded that the ETD is outdated and no longer reflects the EU’s commitment to at least 55% reduction in greenhouse gas emissions by 2030. Therefore, a proposal was put forward to update the ETD on two main areas of reform. Firstly, the proposal introduces a new structure of tax rates based on the energy content and environmental performance of the fuels and electricity. This will include implementing a minimum tax rate based on real energy content and environmental performance of fuels and electricity rather than on volume as is currently mostly the case. Secondly, it broadens the taxable base by including more products in the scope and by removing some of the current exemptions and reductions.

https://ec.europa.eu/commission/presscorner/detail/en/qanda_21_3662

July infringements package: Key Decisions -15 July 2021

The Commission had decided to send a letter of formal notice to Lithuania for its failure to properly apply VAT rules intended to simplify life for small businesses. Under the current VAT scheme for SME’s, small companies in Lithuania with a turnover of less than €45,000 a year do not have to register for VAT. However, under anti-avoidance measures, Lithuania excludes businesses with lower turnovers when their ultimate owner’s annual income exceeds the €45,000 threshold as a whole, even when that person’s other businesses are legally independent and do not use purely artificial structures. The Commission considers this exclusion from the special VAT scheme businesses who, while financially linked, have completely independent economic activities, is disproportionate and contrary to the principle of fiscal neutrality.

July infringements package: key decisions (europa.eu)

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