The VAT Practice,
The White House, Cloncorban, Rossmore, Clonakilty,
Co. Cork
Principal: Nicholas Ryan
Tel: +353 (0)23 8838181
Mob: +353 (0)83 3340324
Fax: +353 (0)23 8838181
Email : info@thevatpractice.ie
Welcome to the VAT Practice blog. Our aim is for our blog to provide you with access to: Hot topics – which features regularly updated information, ideas and comment from The VAT Practice on Irish and international VAT issues. Talk to us – businesses can provide comment on our articles in Hot Topics and enter […]
Construction services involving connected parties: This is an extension of the current rules applied for construction services provided by sub-contractors to principal contractors. From 1 May 2012 the reverse charge accounting facility can be applied to construction services between connected parties without the requirement for a principal/sub-contractor relationship to exist.
The ECJ decision established that two products, which could be goods and/or services, will be similar if they are considered so by the consumer and meet the same needs of the consumer. Therefore it is not necessarily what the provider of the product considers it to be rather what the product is perceived to be by the average consumer. Added to this, the ECJ took the view that, unlike in previous considerations, it is not necessary to firstly identify a distortion of competition between the two products before then applying the concept of fiscal neutrality.
In some ways the new rules have, as was intended, simplified the VAT treatment of transactions in property though in some respects they have provided for confusion in how the VAT treatment is determined. Overall, it seems that we just can’t get our heads around how the new rules address property transactions involving pre 2008 properties. Also, the application and use of the VAT special conditions clauses are proving to be a nightmare for many with a “select all” fallback being the common approach.
As this re-clarification is initiated as a result of these ECJ decisions, and this includes the Rank Group, you would expect there to be uniformity in approach and in interpretation in that pretty much the same rules will be in place in each territory as the issue of fiscal neutrality is once again considered. But no, this is not the case and it is the basis of interpretation that holds the key.