Munster’s first independent VAT consultancy practice providing specialist VAT and Indirect tax advisory, assurance and interim management support services to owner managed businesses, small & medium enterprises, accountants and legal practices.

Revenue News April 2011

Tuesday, April 5, 2011

by Nick Ryan

VAT reclaims for flat rate farmers: Revenue released e-brief 22/11 which confirms that un-registered flat rate farmers may qualify for a VAT refund incurred on certain expenditure items subject to conditions being met. The expenditure items include the construction of concrete underpasses for the movement of cattle where a public road separates the plots of land. Also included are the planting of hedgerows specifically for the purposes of stock proofing and the undertaking of land reclamation, this can include ploughing and re-seeding of the reclaimed land where it is an integral part of the reclamation project.
Finance Bill provisions: The main changes to consider are all covered within the changes announced under the provisions in Finance Bill 2011.
Changes to the penalty regime
The following circumstances are now included within the remit of the statutory penalty regime as encompassed by the Code of Practice for Revenue Audits and can result in a penalty of €4,000:
• Failure to issue a Capital Goods Record for a property.
• Failure to provide the required documentation for the surrender or assignment of legacy leases i.e. lease created prior to 1 July 2008.
• Failure by the vendor to provide the appropriate documentation to enable the transfer of a property under the terms of a sale of a business.
• Failure to maintain the required history of a property for VAT purposes.
• Failure to file VIES returns in respect of services provided.
• Failure of a business holding a VAT 13B authorisation to notify Revenue that they have breached the qualification criteria. The penalty of €4,000 applies to each respective VAT Return period in which the business fails to notify Revenue.
Scrap Metal
With effect from 1 May 2011, businesses supplying scrap metal to customers in Ireland are obliged to account for under the reverse charge mechanism.
Public Bodies
Where a public body makes a taxable sale of residential property, or a burial ground(s), after 1 July 2010 then the public body will be eligible for a VAT credit in relation to the VAT incurred on the purchase and/or development of the property in question. This places a statutory footing on the previous concession allowed in June 2010 as per e-brief 56/10 but which at that time only covered residential property.
Online bookmakers and their intermediaries
Services provided by online bookmakers and remote betting intermediaries are now deemed to be VAT exempt services where the services qualify for betting duty. The scope of betting duty has also been extended to include remote betting intermediaries with a rate of 15% applying to their commission charges.
Postal services
The VAT exemption has been extended to include the supply of public postal services as part of a 2universal postal service” by either a public or designated private operator.
Premises providers
The current advance notice period of 14 days has now been extended to a period of 28 days with the intention that it will give a greater period of time for the premises provider and thereby avoid the potential of the premises provider been made jointly liable for the VAT liabilities of the non- Irish established trader trading from their premises.