Everything You Need to Know about VAT Returns in Ireland

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Accounting, For Business Owners

For many businesses, especially small businesses and startups, navigating VAT regulations will have you wishing you’d tackled this sooner. It isn’t something you can just put off, either: complying with the requirements set by the Revenue Commissioners is crucial to avoid costly errors and potential VAT liabilities.

Understanding your obligations and filing VAT returns accurately (and promptly!) are essential steps to ensure tax compliance. Staying organised and on top of your bookkeeping records is key to saving yourself from last-minute scrambles.

In this post, we'll cover everything you need to know about Irish tax returns, so you can keep your business compliant and stay on top of your finances. We'll go over the following:

Irish VAT Returns Explained

What is VAT for Businesses?

Value Added Tax (VAT) is a tax applied to the sale of goods or services in Ireland. It’s usually included in the price of most products and services you purchase.

As a business owner, you’ll collect VAT for the government and express the numbers through VAT filings. Then, you’ll compare the VAT you’ve collected with the VAT you paid to other providers to create a filing expressing how much you owe (or are owed by) the government.

Plus, if goods are ordered or brought into Ireland from outside the European Union (EU), VAT may apply when arriving in Ireland, so it’s crucial to understand which rules apply – and when to submit your VAT returns correctly.

Irish VAT Rates and Deductions

VAT Rate

Description

23%

The standard VAT rate applicable to most goods and services.

Reduced VAT Rates:

13.5%

Applies to certain goods and services, including certain fuels, certain building services, the importation of certain art and antiques, and live animals.

Applies to goods and services like newspapers and periodicals, catering and restaurant supplies (excluding alcohol, soft drinks, and bottled water), and more.

Zero VAT Rate

Basic food items fall under this category with a VAT rate of 0%.

4.8%

The rate for livestock.

5.5%

Flat-rate compensation percentage for farmers.

How Often Are VAT Returns Required?

For the most part, the frequency of VAT returns in Ireland depends on the size and earnings of your business. Here's a breakdown of VAT return requirements for different business brackets:

Bi-monthly returns:

Bi-monthly returns are standard for businesses that do not qualify for the exceptions below.
These returns must be made using the VAT 3 return form. (The VAT 3 return form is used by businesses in Ireland to report their VAT transactions).

Six-monthly returns:

Businesses with an annual VAT liability of less than EUR 3,000 are eligible for six-monthly returns.
This reporting period allows for fewer returns in a year.

Four-monthly returns:

Businesses with a VAT liability between EUR 3,001 and EUR 14,400 are assigned a four-monthly return period.
This reduces the frequency of VAT reporting for mid-sized businesses.

Remember: if there's a shortfall in VAT, the balance should be paid when submitting the end-of-year (annual) VAT 3 return form. Additionally, all traders must complete an annual Return of Trading Details (RTD) form detailing purchases and sales, categorised by VAT rate, for the entire year.

VAT Return Deadlines

Know when to submit your requests for VAT returns, depending on the VAT you’ve paid to other businesses within your expenses.

Bi-monthly VAT returns:

Deadline: 19th of the following month when you file it in the paper format, and 23rd if you file it using ROS. (e.g., for the January-February period, the deadline is 19th March).

Six-monthly VAT returns:

Deadline: 19th of the month following the end of the VAT return period (e.g., for the January-June period, the deadline is 19th July).

Four-monthly VAT returns:

Deadline: 19th of the month following the end of the VAT return period (e.g., for the January-April period, the deadline is 19th May).

Annual VAT returns:

Deadline: 19th of the month following the end of the VAT return period (e.g., for the entire calendar year, the deadline is 19th January of the next year).

How to Make a VAT Return

To ensure smooth and accurate VAT return filing on your own, use the Revenue Online Service (ROS) for online submissions. If you haven't registered for ROS yet, pause what you’re doing and get to it! The registration process typically takes about one week, so the sooner you do it, the better.

Alternatively, your accountant can file the VAT returns in your stead.

Getting Help with Your VAT Returns in Ireland

That was a quick rundown on Irish VAT returns! While you may have learned how and when to make your VAT returns, you simply may not want to deal with all that.

That’s okay too! You have a business to run, after all.

That’s why solutions like Outmin exist: to take the burden of VAT returns off your shoulders and put them in experts’ hands.

Outmin is your digital, all-in-one accounting solution designed for small businesses. It’s like having a fast, data-driven finance team – without the overhead of salaries and management. (Not to mention – for half the price of an accountant.)

Outmin is powered by revolutionary AI technology, but expert human accountants are always available whenever you need them.

Getting started is simple:

Pick a pricing plan that works for you (starting at a small fee of €199 per)
Upload your documents by dragging and dropping them from your files/desktop, or just use Outmin’s app. The folks at PI Pizza agree that the starting process is silky smooth: “I was surprised at how straightforward the onboarding process was, I just gave the Outmin team the access they required and they did everything in less than a week.”
And that’s it! Lean back as we handle all your filings, from VAT and Corporation Tax to PAYE, VIES, B1, B10, A1, Company Constitution, and more. With us on your side, your financial compliance will always be timely.

Spending hours on bookkeeping and compliance robs you of valuable time that could be used for your business. So forget traditional accounting, forget about the numbers, and let Outmin take the reins!

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