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 eBrief No. 41/12: Revised Pharmacists Scheme for VAT

Wednesday, October 31, 2012

by Nick Ryan

This eBrief released on 20 September 2012 has been welcomed by the industry and tax advisers in its move to simplify the VAT accounting requirements for pharmacists. Revenue’s aim is to bring this scheme up to date and to reflect the changes in practices and activities for pharmacists and manage the accounting problems currently faced.
This revised scheme is available to all pharmacists with a turnover of less than E1.5 million and is based on the application of marking up purchases for resale for those items at the positive rate of VAT. This mark-up calculation is to operate in tandem with the PCRS statements which provide the sales information for the majority of the supplies made. The IPU has developed a spreadsheet and accompanying guide for use by pharmacists in order to manage the scheme.
It should be noted that there is a need for pharmacists to ensure that the mark up they apply is accurate and a true reflection of both the value and volume of the pharmacy business. This, in itself, will require close monitoring by the pharmacist and increase their administrative cost in managing their VAT reporting and compliance obligations.
Should you require more information on the scheme or an assessment on how it effects your clients’ pharmacy business then please contact Nick Ryan, + 353 238838181 or advice@thevatpractice.ie