Who are taxable and accountable persons?

Updated on March 10, 2022


VAT (Value Added Tax) is a tax levied on the sale of goods and services inside the European Union’s member states. In all circumstances, the tax is paid by the final user of the product or service. Each partner in the supply chain (maker, wholesaler, and retailer) collects VAT.

They charge their customers VAT and include it in the Tax returns to Revenue. They can reclaim VAT that has been levied to them by their suppliers by returning the VAT collected.

The state’s jurisdiction includes its territorial waters for VAT purposes. The state’s territorial sea stretches out to a range of 12 nautical miles.

This section clarifies:

who are liable to pay taxes and who are liable to be held accountable

exemption from paying VAT

charge in the opposite direction (self-accounting)

actions that qualify

VAT and tax evasion.

Who is a taxable person?

The term “taxable person” refers to someone who runs a business on their own in the European Union (EU) or elsewhere and is therefore subject to taxation. Flat-rate (unlicensed) farmers and people exempt form Value-Added Tax (VAT) are both included in this category.

Who is a person who is responsible?
Individuals, partnerships, and corporations are all examples of “accountable persons.”

is obliged to register for VAT if they provide taxable products or services in the state.
Therefore, they must impose a state sales tax on their products.

Exemption from VAT

In most cases, a taxable person provides only operations that are free from tax (goods or services).

Such operations are exempt from VAT registration, hence a taxable entity is not required to do so.

If a trader of exempted supplies purchases goods or services from within the EU or outside, they may be compelled to register & account for VAT.

VAT registration may also be necessary for any taxable person who provides taxable goods or services.

VAT registration, on the other hand, has to do with the taxable supplies you make.

To be eligible for a VAT refund, you must be engaged in both exempted and taxable activity.

See our VAT property and construction section for special provisions.

What is reverse charge (self-accounting)?

Most of the time, the person who delivers the goods or services is responsible for collecting and accounting for VAT on their behalf. Although in other circumstances, the recipient is responsible for VAT, rather than the provider.

This is what I’m trying to get at.

purchase of items from another Member Country within the European Union those who accept cultural, artistic, or leisure services from persons who are not entrenched in the State via natural gas distribution system, the acceptance of credits for greenhouse gas emissions from another taxable person based in the state or abroad The accompanying paperwork has additional details.
A tax payer who is involved in the business of dealing scrap metal or delivering construction services in the jurisdiction between two related individuals may transfer their ownership to NAMA.

What are qualifying activities?

VAT can be recovered for expenses spent when providing services that are subject to service tax (ST).

Despite the fact that the expenses associated with the aforementioned activities are not taxed, VAT-returnable input tax credits can be claimed. Criteria-compliant actions are essentially interchangeable.

Examples of appropriate conduct include the following:

Shipping individuals and their luggage with goods that are considered to have been sold in another Member Country due to distance sales restrictions Having a service provider in another EU member state who is VAT-registered is required.
Revenue from outside the European Union or directly related to exporting goods and services from the EU to a non-EU country is a person’s responsibility for tax purposes.

VAT fraud

A Value Included Tax (VAT) fraud can have serious repercussions for those who participate in it. It doesn’t matter if the transactions you’re a part of aren’t illegal.

Revenue will impose penalties when necessary, and you have the following options:

lose the ability to claim back VAT
where deception is involved, you may be liable for Irish Tax on previously zero-rated intracommunity supplies.
More thorough information on preventing VAT fraud can be found in the further guidance.