General VAT Returns
Accountable persons must file VAT returns within 19 days of the month following the two-month taxable period. (ROS users may file by the 23rd day). The taxable year is divided into six two-month periods commencing on first January, March, May, July, September and November in each year.
The return must set out VAT, vatable sales, vatable inputs. The requisite VAT must be paid. Formerly, VAT was returned with a manual paper return. It is now paid through Revenue Online Service in almost all cases.
Some traders are permitted to file annually. Others may be permitted to file bi-annually, three or four times a year. The Revenue may agree to align the annual period with the trader’s accounting period. Biannual filing may be available to traders whose VAT liability is less than €3,000 annually. Triannual is available for traders with liability below €14,400.
Where Revenue permit annual or more frequent returns, they may require payment on accounts. Revenue may give notice of a requirement to make returns less frequently than bimonthly unilaterally.
General VAT Returns II
In addition to regular VAT returns, accountable persons must undertake a return of trading details. This summarises details of trading activities and is made annually.
A VAT return may be made through an agent or representative. A declaration must be made that the VAT returned is correct. There is a €4,000 penalty for failure to make a correct and timely return.
Revenue may enter arrangements in relation to payments on a regular basis, whether by direct debit or otherwise. A schedule may be agreed. It must be based on genuine estimates of the VAT due. Failure to pay sufficient sums may lead to a liability for penalties and interest.
VAT is due must be returned and accounted for. The due date for VAT is set out in other sections. It may be determined by the date of supply, the date of issue of the invoice or by a prepayment in some cases.
VAT on intra-EU supplies is due the 15th day of the month, following the acquisition or earlier, if pre-invoiced.
There are a number of other returns required by traders, some of which are primarily statistical in nature The VEIS return relates to zero rate supplies of goods and services to other states of the EU. The Intrastat return is required in respect of cross-border movements of goods.
The VEIS return covers most transfers out of the state. There are a number of exceptions including transfers for the purpose of repairs or maintenance, transfers for the purpose of having works or services carried out, transfers for temporary use related to the supply of service in another state and distant sales.
A VIES return has been made by all traders which undertake services cross-borders to businesses within the EU. The return must be submitted by 23rd day of the month following the relevant month. Where supplies are less than €100,000 in a month, returns may be quarterly. The threshold was reduced to €50,000 in 2012.
Where a VAT registered trader supplies goods within the EU and does not make cross-border supplies of services, it may be authorised to file annually. Annual returns may be available where turnover is less than €85,000 and intra-EU supplies are less than €15,000. Traders who make intra-EU supplies and services must file VIES quarterly regardless of being below the thresholds. They may elect to file monthly.
The VIES statement sets out VAT numbers of customers and the total supplies of goods and services made to each customer.
Returns may be made electronically. They can be returned by data device, other quasi-electronic means for through ROS. There is a penalty of €4,000 for failure to comply with VIES returns requirements.
The VIES System
VAT controls rely a great deal on the auditing of trader’s commercial records (such as accounts, transport documents, invoices, settlement documents, etc.) and on co-operation arrangements between Member States.
Zero-rating of trade between Member States is conditional on the trader being in a position to show that the goods/services have in fact been supplied to a VAT registered person/trader in another Member State. Other conditions apply.
The VAT Information Exchange System (VIES) put in place by the EU contributes to the effectiveness of the new VAT arrangements. It provides a mechanism whereby checks can be made in each Member State on the validity of claims to zero-rating and it helps to detect unreported movements of zero-rated goods between Member States.
VIES also enables traders who have doubts about the validity of VAT numbers quoted to them, to confirm the VAT registration numbers of their customers in other EU Member States.
Under the EU rules governing VAT in the Single Market, VAT registration numbers in all the Member States have, from 1st January 1993, been prefixed by alpha codes indicating the country of their issue. Irish VAT numbers have been prefixed by “IE” to denote their Irish origin.
The full list of Member States and their alpha codes is as follows: Austria (AT), Belgium (BE), Bulgaria (BG), Croatia (HR), Cyprus (CY), Czech Rep (CZ), Denmark (DK), Estonia (EE), Finland (FI), France (FR), Germany (DE), Greece (EL), Hungary (HU), Ireland (IE), Italy (IT), Latvia (LV), Lithuania (LT), Luxembourg (LU), Malta (MT), Netherlands (NL), Poland (PO), Portugal (PT), Romania (RO), Slovakia (SK), Slovenia (SI), Spain (ES), Sweden (SE), United Kingdom (GB).
The proper alpha code forms an integral part of all VAT numbers and must be quoted along with the VAT number on all invoices.
For VIES purposes only Northern Ireland VAT numbers use the GB prefix, and Greek VAT numbers use the EL prefix.
An essential part of the VIES arrangements is that traders making E.U. supplies to other Member State are obliged to provide to their tax authorities, periodic statements giving specific details of their trade (i.e. intra-Community supplies of goods/services and certain transfers of goods) with other Member States. Each Member State maintains a database in which it stores and processes the information on these statements to enable control checks of the kind mentioned in paragraph 2.3 to be carried out.
The VIES system applies to intra-EU trade only. The Customs requirements including the normal export entry procedure (SAD) continue to apply to third country trade.
VIES Return Details
Each VAT registered supplier of goods/services to other Member States is required to supply a periodic VIES statement to VIMA containing the following information:
- traders own VAT registration number
- the VAT registration number, including the relevant national alpha codes of each of the customers in other Member States to whom they have made a zero- rated intra-Community supply of goods/services e.g. export sales, during the period
- the total aggregate value of such supplies made to each such customer during the period.
The date that the VAT becomes chargeable determines in which periodic VIES Statement the supply is to be included. VAT becomes chargeable on the date of issue of the invoice or the 15th day of the month following that of the supply, whichever is the sooner. In the case of transfers for business purposes, the determining date shall be the date the goods were transferred.
A statement is required in respect of each calendar month if the value of supplies exceeds the quarterly threshold of €50,000 for goods. Suppliers of services may opt to file quarterly statements.
Exporters whose total annual supplies are under a certain value may apply to make one statement each year (A1 or A2). The criteria for determining A1 or A2 status are set out below:
A1 and A2
- where the trader’s supplies of goods and related services do not exceed or are not likely to exceed €200,000 in the calendar year, and
- his intra-Community supplies do not exceed or are not likely to exceed €15,000 in the calendar year,and his supplies do not include the supply of new means of transport
An A1 statement is similar to any monthly or quarterly statement and all the relevant details i.e. VAT nos. of customers, values, flags etc. must be supplied.
As i above except that the €200,000 figure in is replaced by a figure of €85,000. An A2 statement requires the declarant to list the VAT nos. of the trader’s customers in the other Member States, but does not require the value of the trade or “T” flag.
Where a supplier makes no supplies to other Member States in a particular period, a “Nil” statement must be submitted for that period.
The VIES Statement involves the furnishing of aggregate turnover information only. Traders should not provide details of individual transactions on the VIES Statement, but merely a total value figure for trade with each VAT registered customer in another Member State in the course of each period.
Information collected by each Member State from VIES Statements is available to the tax authorities of other Member States solely for the purpose of controlling the taxation of goods acquired in other Member States and in order to combat evasion of VAT.
Vies Statements must be filed on-line, using Revenue’s On-line Service (ROS), for current year and previous two years only. Traders who are required to submit statements prior to then must contact Vies Section for paper Vies statements. For sample Vies Statement forms please see Appendix 2. A separate form is available to enable traders to make corrections to previously submitted statements (see paragraph 4.9). Vies Statements are additional to and separate from Vat 3 returns.
Although traders identified by the VIMA office as being currently involved in intra-Community trade may be advised of their obligations under the VIES system, the onus is on the traders to supply this information even if not specifically advised of their obligations by VIMA.
A trader may make their own VIES Statement or may appoint an agent (e.g. his accountant or the person who completes his VAT returns) to make VIES Statements on his behalf.
The obligation to make an Intrastat return is a statistical requirement. Traders must complete the specific parts of the VAT return which deal with interstate issues.
Where dispatches to other state exceed €635,000 or arrivals from states exceed €500,000 a more detailed Intrastat return is required. The trader will generally be informed, but it is a self-assessment obligation.
Where the dispatch threshold has exceeded a dispatch Intrastat return only is required. There is a corresponding provision in relation to intra-EU acquisitions. A more detailed Intrastat return is required where arrivals exceed €5 million and dispatches €35 million annually.
The E1/E2 part of the regular VAT return is required in the normal course. The more detailed forms are required 10 working days after the end of the month to which it relates.
Intrastate returns may be made by an agent. In a VAT group, it may be returned by the remitter. The returns may be made through a number of electronic means or through Revenue On-line service ROS.
There is a penalty of €1,165 euro and thereafter €65 euro per day for failure to comply.
Nature of Intrastat
INTRASTAT is the name given to the system for collecting statistics on the movement of goods, not services, between the Member States of the European Union (EU). It has been in operation since 1 January 1993, and replaced customs declarations as the source of trade statistics within the EU. It should be noted that the use of the term “trade” in “trade statistics” is a reflection of the dominant role of buying and selling in the generation of the cross-border flows of goods.
However, many other movements of goods between Member States which are not resulting from trade transactions are covered as well. The general concept of intra-EU trade statistics is independent from the ownership of the goods and concerns only their physical movement.
The trade statistics collected by the INTRASTAT system are an important source of information for business, as well as being of vital interest to Government Departments and the EU. Economists and financial institutions also regularly request INTRASTAT data.
INTRASTAT data is the source for EU Goods Exports and Imports data published by the Central Statistics Office. It is therefore important that the statistical information submitted by traders is timely and accurate.
All VAT registered traders must complete boxes E1 (total goods and related costs to other EU Countries i.e. Dispatches/ Exports) and E2 (total goods and related costs from other EU Countries i.e. Arrivals/ Imports) on their VAT3 return, as and when the VAT 3 return is due. For each box a single value figure only is required; no breakdown of trade with different Member States or the type of trade is necessary on the VAT 3 form. These boxes should never be left blank (zeroes should be entered when appropriate). Services alone or non-community goods should not be included here.
VAT registered traders whose total Dispatches to other Member States exceed €635,000 in value annually, or whose total Arrivals from other Member States exceed €500,000 in value annually are obliged to provide a more detailed INTRASTAT statistical declaration of their trade each month, even if that is a “Nil” declaration. These thresholds apply on a calendar year basis, that is, January to December. Thresholds are reviewed annually and may be changed.
VAT registered traders whose trade in goods with Member States of the EU is known to exceed the relevant threshold(s) must complete detailed monthly INTRASTAT declarations. The legal entity liable to declare the Arrival/ Dispatch of the goods in IE is the trader who concluded the contract that gave rise to the movement of the goods. The same person will normally be able to zero-rate the sale of the goods for VAT (but see also 2.8 Distance Sales), or account for acquisition VAT on the arrival of the goods.
In cases where the trader who concluded the contract is unable to provide the data required (e.g. electricity) then the trader who actually transfers the goods will be responsible for making the declaration. Similarly if the legal entity that concluded the contract is not resident in IE then responsibility for the declaration rests with the entity that arranged for the physical dispatch of the goods or takes possession of the goods that have arrived in IE.
The onus is on traders to supply this information even if not specifically advised of the obligation by VIMA .
A trader, while retaining full responsibility for the data, may under certain conditions appoint an agent(s) to make declarations on his/ her behalf
The detailed INTRASTAT declaration is required on a monthly basis. This declaration must be received in the VIMA office not later than the 23rd day of the calendar month immediately following the end of the month to which the declaration relates.
Traders who wish to submit declarations more frequently than one per month per flow (i.e. a number of part-declarations) must have prior authorisation from VIMA. Where part- declarations are being made, the last part-declaration must be made by the deadline date
The INTRASTAT monthly declaration should be submitted electronically to VIMA via ROS, Revenue’s Online Service.
A trader who exceeds either one or both of the thresholds above shall provide a detailed INTRASTAT declaration for the appropriate flow(s) for each period of the calendar year of application from the period in which the threshold is exceeded and shall continue to submit declarations thereafter subject to 1.16 below.
What is included
Details are required of almost all transactions, whether commercial or not, which lead to a movement of community goods from a VAT registered trader in one Member State to any person or trader in another Member State.
Community goods are:
- goods entirely obtained in the customs territory of the Community
- goods from countries outside the customs territory of the Community which have been put into free circulation
- goods which have been obtained from the second category or a combination of the first and second categories.
For INTRASTAT purposes it is the date that VAT becomes chargeable which determines in which VAT statement or INTRASTAT monthly declaration a transaction is included. VAT becomes chargeable on the date of issue of invoice. If a VAT invoice is required to be issued, it must be issued within fifteen days of the end of the month in which goods are supplied. Failure to issue a VAT invoice in time leaves a supplier open to prosecution. If the invoice is not issued in due time, VAT becomes chargeable upon the expiration of the period within which the invoice should have been issued.
Where VAT is not chargeable on a particular movement of goods, the reference date is the date the goods arrived in or left the State.
Traders must declare the value of their INTRASTAT declaration in Euro. The exchange rate used for VAT purposes is acceptable, as is the period rate published by the Revenue Commissioners.
INTRASTAT corrections A trader who discovers s/he has understated or overstated the value of his/ her INTRASTAT trade by 5% or more in an individual INTRASTAT monthly declaration must immediately notify the VIMA office.
A trader may cease submitting detailed monthly INTRASTAT declarations at the end of a calendar year in which his/ her trade with other Member States falls below the INTRASTAT threshold set for the following year. Example: A trader whose trade in 2016 does not exceed the threshold set for 2017 will not have to submit detailed declarations in 2017, provided s/he remains below that threshold over the course of the year.
Traders required to submit detailed monthly INTRASTAT declarations must a. retain a copy of every detailed monthly INTRASTAT declaration they make or which is made on their behalf; b. retain copies of all papers and documents which have been used for the purpose of compiling detailed monthly INTRASTAT declarations. These records must be preserved for 2 years. This applies equally to information stored by electronic means.
Any of the above records must be produced to authorised Revenue officers when required to do so. Authorised Revenue officers may make copies or extracts or remove records for a reasonable period.
Provision has been made for penalties for non-compliance, either in the form of failure to make declarations or inaccurate or incomplete declarations.
A person who thus fails to comply with a provision of the EU Regulations or who is guilty of an offence under the national legislation S.I. 610/2011 is liable on summary conviction to a fine of €1265.
In respect of a continuing offence such as non-compliance, a convicted person may incur an additional fine of €60 for each day that the failure continues.
There is also provision for the prosecution of the directors, managers, secretary, or similar officer of a body corporate in certain circumstances. Payment of a penalty does not absolve the trader from his/ her legal obligation to submit declarations for the periods covered by the penalty.