VAT registration In Ireland

Every legal business entity operating in Ireland is obliged to pay VAT, save for a few businesses and individuals who are exempted; fishers, farmers and a few others. VAT is added on to the value of services or products at each stage of production or distribution. It’s rather a clever structure set up by governments to make companies unpaid tax collectors. The upside to VAT is that if your business is VAT registered, you can claim a VAT credit from the Irish Revenue for the tax you paid to other VAT registered entities. Sadly final consumers can only pay VAT but they cannot claim it.
How to successfully register for VAT in Ireland?
In order to get an Irish VAT number, your company should apply for the registration with the Irish Revenue. The Irish Revenue will evaluate your application focusing on the following main key points:

  • Your business should be headquartered or controlled from Ireland
  •  The company should have a physical office in Ireland, Virtual Offices will not be accepted.

The Irish Revenue provides two main forms for registering VAT:

  • Form TR1

This form can be used by individuals, trusts, partnerships or unincorporated firms.

  • Form TR2

This form is used if you are trading as a company
Why you should Register for VAT?
Apart from the fact that by law, every business in Ireland which surpasses the VAT threshold should register for VAT, there are a couple of benefits you can get from registering for VAT. Just to mention a few, if your company does business with many other VAT-registered individuals and companies, you will have the opportunity to reclaim some of the VAT. 
Reasons Why Your VAT Registration might be turned down

  • Your business doesn’t have an Irish workforce
  • Your company is not involved in trade with any Irish suppliers
  • There is no evidence that you have Irish customers interested in your products or services.

How long you should wait for your VAT number?
The Irish Revenue, the board responsible for issuing the VAT number usually takes 28 working days before issuing the VAT number. In some cases, you will be required to answer a few additional questions before you can be given your VAT number. Upon receiving these inquiries, the Revenue will give you a period of thirty days to reply but the sooner you reply, the better.
Who is obliged to register for VAT in Ireland?
Below are some of the most common scenarios whereby individuals or entities are obliged to pay for VAT:

  • Anyone involved in buying or selling goods in Ireland
  • Organizers of events or gatherings in Ireland, with the attendees having to pay a fee of admission.
  • Exporting goods out of Ireland
  • Importation of goods from non-EU countries
  • Intra-community acquisitions
  • E-commerce sales of goods or services to customers who are subject to Distance Selling VAT registration
  • If you are storing inventory in Ireland for distribution, consignment, or for sale.

The above information should help you to get started. For more details and insights into VAT registration, reach out to our expert consultants at SIGTAX. We are ready to assist in all aspects of the registration process. Our experienced team will smoothen the process for you, keep you informed and help you to dodge the common pitfalls encountered by many individuals.

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