Revenue Updates – June 2021  

Indirect Tax Matters June 2021

Revenue eBrief No. 025/21 – 12 February 2021

Customs Manual on Import VAT

This manual 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”). A topical update following Brexit means that it has been updated to include:

  • The withdrawal of a concession which has become redundant due to the introduction of 'Postponed Accounting'
  • An updated link to the AIS Trader Guide
  • Updated AIS codes

Revenue eBrief No. 031/21 - 16 February 2021

Partial Recovery of VAT on Qualifying Passenger Motor Vehicles

The Tax and Duty Manual Partial Recovery of VAT on Qualifying Passenger Motor Vehicles has been updated to reflect the definition of a "qualifying vehicle" effective from 1 January 2021 in accordance with Finance Act 2019.

A qualifying passenger motor vehicle is a vehicle that is used for at least 60% business purposes (for a period of 2 years or more) and

  • Was first registered for Vehicle Registration Tax (VRT) purposes on or after 1 January 2009 up to 31 December 2020 and has CO2 emissions of less than 156g/km (i.e. CO2 emission bands A, B and C) or
  • Was first registered for Vehicle Registration Tax (VRT) purposes on or after 1 January 2021 and has CO2 emissions of less than 140g/km (i.e. CO2 emission bands A and B)

Revenue eBrief No. 044/21 - 5 March 2021

Hard Copy Returns

The requirements for the making and authentication of hard copy returns are set out in section 917K of the Taxes Consolidation Act 1997. A new Tax and Duty Manual – Part 38-06-03 – provides general guidance on the process.

Following a change introduced in Finance Act 2019, Revenue is no longer approving the format, or technical detail, of the returns of third party software providers. The relevant schema and notes for third party software providers are available on the Revenue website.

Revenue eBrief No. 050/21 - 9 March 2021

VAT - Postponed Accounting - Entries on VAT3 Return and VAT Return of Trading Details (RTD)

The VAT - Postponed Accounting Tax and Duty Manual has been updated to include information on Postponed Accounting entries on the VAT3 Return and the VAT Return of Trading Details.

To recap, Postponed Accounting arrangements enable an accountable person to self-account for VAT on imports on their VAT return so that import VAT may, subject to the usual rules on deductibility, be reclaimed at the same time as it is declared on a VAT return. This updated information will be no doubt be welcome by traders availing of postponed accounting arrangements.

Revenue eBrief No. 059/21 - 23 March 2021

VAT & Employees' Pension Fund

We welcome further clarification to the Tax and Duty Manual VAT & Employees' Pension Fund on the circumstances where an employer can claim deductibility for costs incurred in relation to an employee pension fund.

A taxable person (the employer) is entitled to deductibility in respect of costs incurred in the setting up, on-going management, administration, and management of the assets of a pension scheme where certain conditions are met.

To be entitled to deductibility a taxable person must meet all the following conditions:

  • The costs of the input transaction must form part of the employer’s general costs and must be, as such, components of the price of the taxable goods or services it supplies.
  • The costs incurred must be invoiced to, and paid by, the employer and not passed on to the pension fund.
  • The existence and extent of the right to deduction is determined in the light of the direct and immediate link with the employer’s economic activity, and more precisely, its taxable activity.

Revenue eBrief No. 061/21 - 24 March 2021

Charitable Donations Scheme

An update to the Charitable Donations Scheme:

In summary, this scheme allows tax relief on qualifying donations made to approved bodies. If an individual donates €250 or more in a year, the approved body can claim a refund of tax paid on that donation. If a company donates €250 or more in a year, the company can claim a tax deduction as if the deduction was a trading expense. There is a 4 year limit for making a claim under this scheme.

There have been a number of updates including clarification that applications for the charitable tax exemption are made online through ROS.

Revenue eBrief No. 066/21 - 25 March 2021

The VAT treatment of the procurement of certain Goods and Services by a Public Body

This guidance sets out the circumstances in which a public body, which is not otherwise a taxable person in relation to its activities, may engage in the procurement of certain goods or services in respect of which they will be required to register and account for VAT.

‘Public body’ is a broad ranging term, which includes Government Departments, An Garda Síochána, the Defence Forces, local authorities including regional authorities and harbour authorities, the Health Services Executive, State sponsored bodies, public hospitals, enterprise boards and educational establishments, such as, Universities, Institutes of Technology, Education and Training Boards and schools.

The manual has been updated regarding the implications arising from the requirement to apply the reverse charge mechanism to received construction services.

Where a public body is required to register for VAT by virtue, solely, of the fact that it is required to account for VAT on received construction services, that public body will not be considered to be a VAT registered person for any other purpose. A public body in those circumstances will not, for example, be required to account for VAT in respect of intra-Community acquisitions unless they breach the relevant registration threshold or are otherwise obliged to register for VAT.

Revenue eBrief No. 067/21 - 26 March 2021

Sale of Live Animals by Auction (Mart)

A new Tax and Duty Manual - Sale of Live Animals by Auction (Mart) – has been published detailing the application of VAT to sales of live animals by auction.

The Manual on Flat-rate Farmers Settlement Vouchers – Sales to Marts has been archived.

Revenue eBrief No. 070/21 - 30 March 2021

VAT eCommerce - Registration for the One Stop Shop (OSS) and Import One Stop Shop (IOSS) from 1 April 2021

The purpose of this manual is to outline the requirements for pre-registration for the new One Stop Shop (OSS) and the new Import One Stop Shop (IOSS) from 1 April 2021.

The expansion of the current Mini One Stop Shop (MOSS) to a One Stop Shop (OSS) and the introduction of the Import One Stop Shop (IOSS) will go-live from 1 July 2021.

As previously highlighted, new VAT eCommerce rules will come into effect from 1 July 2021. These amendments will significantly change the way VAT operates for cross-border business-to-consumer (B2C) e-commerce activities in the EU.

From 1 April 2021, eligible businesses may opt to register for these schemes in advance of the go live date of 1 July.

The main changes that will enter into force from 1 July 2021 are as follows:

  • Extension of the VAT Mini One Stop Shop (MOSS) to a One Stop Shop (OSS)
  • The treatment of Online Marketplaces and Platforms as deemed suppliers for certain transactions
  • Introduction of a new Import One Stop Shop (IOSS)
  • Introduction of Special Arrangements for certain imports of goods on 1 July 2021.

Revenue eBrief No. 072/21 - 1 April 2021

Charities VAT Compensation Scheme

This scheme was introduced to reduce the VAT burden on charities and to partially compensate for VAT paid in the day to day running of the charity. The scheme applies to tax paid on expenditure on or after 1 January 2018 and so VAT paid in years prior to that cannot be claimed. Refunds will be paid one year in arrears.

A total annual capped fund of €5m is available for payment under the scheme, and the scheme will be subject to review after three years. Charities will be entitled to claim a refund of a proportion of their VAT costs based on the level of non-public funding they receive. Where the total amount of eligible claims from all charities in each year exceeds the capped amount, claims will be paid on a pro rata basis.

The scheme has been updated to include information on the treatment of Covid-19 wage subsidy scheme payments for the purposes of calculating a VAT Compensation Scheme claim.

Revenue eBrief No. 075/21 - 7 April 2021

Customs Export Procedures

The Customs Export Procedures Manual has been updated to provide further information in light of Brexit and to make minor amendments to the text where necessary. The significant changes include:

  • Amending the list of special fiscal territories
  • Introduction of a new office of export for goods travelling to Great Britain via Northern Ireland
  • Information on preferential origin for trade with the UK
  • Information on Voisinage Arrangements and fishing procedures for trade with Great Britain and Northern Ireland
  • Changes to the entitlement to the Retail Export Scheme.

Revenue eBrief No. 081/21 - 9 April 2021

Customs Import Procedures Manual update

The Customs Import Procedures Manual has been updated to provide additional information in light of Brexit. Some minor amendments have also been made to improve the text. Amendments include:

  • Information on the preferential rules of origin as agreed under the UK-EU Trade and Cooperation Agreement
  • Guidance on the Voisinage Arrangement with Northern Ireland and the customs formalities with the UK for fisheries
  • Information on customs formalities required for importation of vehicles from GB and Northern Ireland
  • Update of the list of countries considered the Special Fiscal territories of the EU
  • Further information on the procedure for oral declarations
  • Further information on the procedure for Returned Goods Relief.

Such topical updates to both export and import procedure manuals will no doubt be welcome for those trading with the UK post Brexit.

Revenue eBrief No. 090/21 - 30 April 2021

Excise Duty Rates on Energy Products and Electricity Taxes

The Tax and Duty Manual on Excise Duty Rates on Energy Products and Electricity Taxes has been updated to reflect increases in rates of Mineral Oil Tax (MOT) on certain mineral oils, rates of Natural Gas Carbon Tax (NGCT) and Solid Fuel Carbon Tax (SFCT) introduced with effect as on and from 1 May 2021.

EU Commission Updates

Coronavirus Response: Commission proposes to exempt vital goods and services distributed by the EU from VAT in times of crisis

On 12 April in response to the experience gained during the course of the Coronavirus pandemic, the European Commission proposed to exempt from VAT goods and services made available by the European Commission, EU bodies and agencies to Member States and citizens during times of crisis.

Once in place, the new measures will allow the Commission and other EU agencies and bodies to import and purchase goods and services VAT-free when those purchases are being distributed during an emergency response in the EU. The recipients might be Member States or third parties, such as national authorities or institutions.

Commission initiates an investigation to decide whether to prolong the steel safeguard measure

On 26 February, the European Commission initiated an investigation to assess whether the safeguard measure currently in place on imports of certain steel products should be prolonged beyond 30 June 2021 following a request received from twelve Member States.

The Commission will in its investigation determine whether the safeguard measure continues to be necessary to prevent or remedy serious injury to the EU steel industry and whether the industry is adjusting. The investigation will also include a Union interest assessment. The investigation will be concluded by the expiry date of the existing safeguard measure on 30 June 2021.

The steel safeguard measure was introduced in July 2018 to manage the volume of steel entering the EU Single Market. The measures currently in place apply a 25% tariff on steel imports from non-EU Member States landing in the EU which exceed quotas set in line with traditional volumes of trade in steel.

Commission puts in place transparency and authorisation mechanism for exports of COVID-19 vaccines

On 29 January, the European Commission put in place a measure requiring that COVID-19 vaccine exports outside the EU are subject to authorisation by Member States. The measure was introduced to ensure timely access to COVID-19 vaccines for all EU citizens. The transparency and authorisation system will require companies to notify the Member State authorities about the intention to export vaccines produced in the European Union. This scheme only applies to exports from companies with whom the EU has concluded Advance Purchased Agreements.

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