Regulation 24(1) of the Value-Added Tax Regulations 2010 (S.I. No. 639 of 2010) requires all VAT registered traders to submit a VAT Return of Trading Details (RTD) on an annual basis, following the end of the respective accounting period.
In the case of companies registered for corporation tax, an annual VAT return will be required for the 12 month period based on the company’s accounting period for corporation tax. The annual return is due to be filed within 23 days of the year end.
The RTD is a summary of supplies of goods and services, imports and purchases giving rise to deductible input VAT at the various VAT rates. The return includes all Irish, intra-EU and overseas trade carried out by the Irish business. The VAT exclusive value of the supply of goods and services should be included. All turnover, including turnover at exempt rates and at the zero rate must be included on the form.
Failure to file - increase in the Relevant Contracts Tax (“RCT”) rate applicable to sub-contractors and denial of tax clearance certificate
As notified by Revenue in e-Brief No. 51/14, when a business files a claim for a repayment or refund of tax under any tax head and there is an outstanding VAT RTD with a due date within the previous 12 months, then that repayment or refund will be automatically withheld. To date, the Revenue have delayed refunds of tax in this regard, but a failure to file a RTD was unlikely to have had any further impact.
Over the past two years, Revenue have increased the RCT rate applicable to sub-contractors who have not filed their RTD and have also denied tax clearance in such cases. The increase in the RCT applicable to sub-contractors is having a detrimental effect on cash-flow if 20% or 35% of the gross payment is being withheld.
Don’t be late
All RTD’s must be filed on time via the Revenue Online System (“ROS”) to avoid the negative consequences as above. Please contact a member of our indirect tax team if you require assistance with completion of your RTD or achieving zero rate status as a sub-contractor.