Tax

Quarterly indirect tax update – April 2021

Welcome to the latest edition of our Indirect Tax Quarterly Update which covers a range of topical international VAT issues which have an impact on both Irish and EU based businesses:  

2021 e-commerce VAT package

The e-commerce VAT package is due to come into force on 1 July 2021. As of 1 April 2021, businesses wishing to avail of the benefits provided for by the new One Stop Shop (“OSS”) schemes can pre-register with the Irish Revenue. The changes contained in the package will have a significant impact for any business selling goods and/or services to consumers (i.e. private individuals and non-VAT registered persons) across the EU. The changes also affect marketplaces and platforms facilitating such sales where the value of goods is below €150.

VAT implications of company purchases for both business and personal use

We consider a key aspect arising from recent Revenue audits – the scrutiny of VAT issues surrounding the personal use of company assets and expenditure by a company on personal items, and how businesses can ensure they are prepared for a future audit.

Recent case law of the Court of Justice of the European Union

There have been a number of important EU cases of late. In this edition, we examine the concept of whether an entity is precluded from adjusting wrongly issued invoices and the associated overpaid output VAT following a tax investigation. The impact of this decision will of course have ramifications for EU businesses.

Brexit

Albeit a number of the initial complexities surrounding Brexit have abated, one particular area of concern is the VAT and customs treatment of vehicles being imported into Ireland from both Great Britain and Northern Ireland post Brexit. The UK recently introduced significant changes to the UK VAT margin scheme for used cars imported from Great Britain into Northern Ireland. These changes are not in compliance with provisions of EU law on VAT that apply in Northern Ireland as per the Northern Ireland Protocol, and this is having an impact on the overall cost of the imported vehicle for the Irish customer.