VAT FAQs

Vocational training is exempt where provided by a recognised school, college, or university. [1]

Vocational training means “instruction relating directly to a trade or profession as well as any instruction aimed at acquiring or updating knowledge for vocational purposes”. [2]

Vocational training is training which:

  • trains people for future employment, or
  • improve their ability to carry out their existing duties.

For training to be exempt:

  • It must be vocational, i.e., directed towards an occupation and its associated skills
  • It must be provided to improve the vocational rather than the personal skills of the trainee
  • The trainee must acquire skills that are transferable from one employment to another.
  • The training is structured, with concise aims, objectives and learning outcomes
  • There should be a clear trainee/trainer relationship between the student and the teacher or instructor.

Examples of exempt vocational training:

  • Cookery lessons for trainee chefs.
  • Payroll training to payroll operators in a company.
  • Training in anti-money laundering legislation for employees in a financial services firm.
  • Training employees in use of software.
  • A conference or seminar organised with the primary purpose of providing vocational training or retraining to the participants.

Example of training which does not qualify as exempt:

  • Assertiveness training.
  • Belly dancing classes.
  • Courses which are primarily of a recreational nature.
  • Private cookery lessons.
  • Personal development programmes.
  • Personal finance course.
  • Pre-retirement course.
  • Lecturing services.
  • Life coaching programme (but coaching of life coaches is vocational).
  • Management consultancy services.

In general, VAT cannot be reclaimed on a passenger motor vehicle, i.e., a vehicle designed and built to carry passengers by road. It includes a:

  • sports car
  • station wagon
  • estate car
  • moped
  • motor cycle
  • scooter

If the vehicle is in CO2 emissions bands A, B or C, 20% of the VAT can be reclaimed.

VAT can be reclaimed on business use if the vehicle comes within VRT Category B or C. If the vehicle is used partly for business and partly for non-business use, then the trader can reclaim the business use portion.

Category B are N1 vehicles (commercial vehicles designed and constructed for the carriage of goods and not exceeding 3.5 tonnes) with less than 4 seats, and have, at any stage of manufacture, a technically permissible maximum laden mass that is greater than 130 per cent of the mass in service of the vehicle with bodywork in running order.

The term passenger motor vehicle does not include, and therefore VAT can be claimed on:

  • bus or minibus (i.e., a vehicle designed and built to carry more than 16 passengers), or
  • a vehicle designed and built to carry invalids.

VATCA 2010 s 60

To cancel an election to be registered for VAT, you must pay Revenue the cancellation amount, calculated as [A + B ] – C where:

  • A equals deductible VAT
  • B is VAT on Intra-Community Acquisitions, and
  • C is VAT on sales.

These figures are calculated for the period of the election, or 3 years prior to the date of application for cancellation, whichever is the lesser. [1]

To cancel an election in respect of income from accommodation (e.g., holiday home) acquired

On or after 1 July 2008 you must pay Revenue the capital goods scheme adjustment.

Before 1 July 2008 you must pay the Revenue the cancellation amount – i.e., the total adjustment amount for each property. This is D x [(10-E)/10] where D is the VAT reclaimable on the property, and E is the number of full years for which the property was used as accommodation.

The formula means there no cancellation adjustment if the holiday home was let for 10 years. [2]

1 VATCA 2010 s 8(1)

2 VATCA 2010 s 8(2)

Reverse charge means the recipient (not the supplier) accounts for VAT on a supply. Reverse charge applies where:

  • A business person receives services from abroad. [1]
  • A foreign person supplies gas, heat, cooling energy, or electricity through a recipient in the State. [2]
  • A foreign person supplies and installs or assembles goods for a recipient in the State. [3]
  • A property is transferred to NAMA. [4]
  • A greenhouse gas emission allowance is transferred from one taxable person to another. [5]
  • A subcontractor supplies construction services to a principal contractor. [6]
  • A scrap metal dealer receives scrap metal from another taxable person. [7]
  • A person supplies construction services to a connected person. [8]
  • A taxable person supplies natural gas to a taxable dealer. [9]
  • A taxable person supplies a gas or electricity certificate to another taxable person. [10]
  • A legacy lease is surrendered or assigned. [11]
  • A customer receives investment gold from a gold trader who has waived his exemption. [12]
  • The taxable amount in relation to reverse charge services is the consideration for the supply. [13]

The recipient can claim input credit against the reverse-charged VAT based on his recovery rate. A person accountable solely in respect of reverse-charged services is not entitled to reclaim VAT. [14]

1 VATCA 2010 ss 12(1)-(2), 59(2)(g)

2 VATCA 2010 ss 10(1), 59(2)(e)

3 VATCA 2010 ss 10(2) 

4 VATCA 2010 s 16(1)

5 VATCA 2010 ss 16(2), 59(2)(h)

6 VATCA 2010 ss 16(3), 59(2)(i)

7 VATCA 2010 ss 16(4), 59(2)(ia)

8 VATCA 2010 ss 97(3), 59(2)(ib)

9 VATCA 2010 ss 16(6), 59(2)(ic)

10 VATCA 2010 ss 16(7), 59(2)(id)

11 VATCA 2010 ss 95(8), 59(2)(j)

12 VATCA 2010 ss 90(5), 59(2)(p)

13 VATCA 2010 s 42(3) 

14 VATCA 2010 s 59(3)

15 VATCA 2010 s 59(2)(f)

The place of supply rules for goods:

  • Transported goods: where the transport begins.
  • Goods that are installed or assembled by supplier: where installed or assembled.
  • Goods not dispatched or transported: where the goods are located at the time of the supply. The general rule.
  • Goods supplied on board a boat, aircraft or train travelling between EU States: where the journey begins. [1]

For goods imported into the EU, the place of supply is the EU State of arrival. [2]

The place of supply of an ICA is the EU State of arrival. If the acquirer uses a VAT number issued by a different EU State, then the place of supply is the EU State that issued the number, unless the customer can prove that the VAT was accounted for in the State of arrival. [3]

The place of supply of auction scheme goods that are dispatched to another EU State is the EU State in which the dispatch begins. [4]

1 VATCA 2010 s 29(1)

2 VATCA 2010 s 29(2)

3 VATCA 2010 s 32

4 VATCA 2010 s 89(8)

Where property located: property-related services, e.g., accommodation (hotels, guesthouses, etc.), estate agents’ services. [1]

Where physically carried out:

  • Cultural, artistic, sporting, scientific and educational services.
  • Ancillary transport services, valuation of movables, contract work.
  • Restaurant or catering services.

Where transport begins:

intra-EU transport of goods. [2]

Short term hire of means of transport: where placed at the disposal of the customer.

Where supplier is located:

business to consumer (B2C) services. [3]

Where customer is located:

business to business (B2B) services, [3] and these B2C services supplied to a non-EU customer:

  • Intellectual property services.
  • Advertising services.
  • Professional services (accountants, lawyers, consultants, etc.)
  • Refraining from pursuing an activity.
  • Financial or insurance transactions.
  • Supply of staff.
  • Hire of movable goods.
  • Provision of access to gas or electricity networks.
  • Telecommunication services.
  • Broadcasting services.
  • Electronically supplied services. [4]
  • Long-term hire of means of transport to a non-taxable person.

The State:

  • Hire of movable goods used and enjoyed in the State. [5]
  • Telecommunications service, broadcasting service, phone card, supplied to a non-taxable person and used and enjoyed in the State.[6]
  • Financial or insurance service used and enjoyed inside the State. [7]
  • Money transfer service used and enjoyed in the State. [8]
  • On board restaurant or catering services (if the point of departure is in the State).
  • Electronically supplied services supplied from outside the EU to a non-taxable person in the State.

Outside EU:

  • Hire of means of transport if used and enjoyed outside EU.
  • Where transport takes place: transport outside the EU. [9]

1 VATCA 2010 s 33(2)

2 VATCA 2010 s 33(3)

3 VATCA 2010 s 34

4 VATCA 2010 s 33(5)

5 VATCA 2010 s 35(1) 

6 VATCA 2010 s 35(3) 

7 VATCA 2010 s 35(5) 

8 VATCA 2010 s 35(6)

9 VATCA 2010 s 35(2)

10 VATCA 2010 s 34(2)

The following are not obliged to register but can elect to register: [1]

  • A farmer, whose 12 month turnover does not exceed €75,000 from the supply of bovine semen and/or garden centre stock, or €37,500 from the supply of agricultural services (and bovine semen and/or garden centre stock).
  • A sea-fisherman, i.e., a person who only supplies unprocessed fish which he caught at sea, and whose other turnover is beneath the registration limit.
  • A supplier whose 12 month turnover (derived as to 90% or more from supply of goods) does not exceed €75,000. In calculating the 90%, “goods” does not include goods sold at 13.5% or 23% which have been made from materials charged to him/her at 0% (for example, confectionery).
  • Any other supplier whose 12 month turnover does not exceed €37,500.

The following must register and may not elect:

  • A person who receives reverse-charge services from abroad.
  • A foreign trader (a person not established in the State) who supplies cultural, artistic or entertainment services in the State.
  • A person who makes premises available to a foreign trader. [2]
  • A foreign trader (a person not established in the State) cannot to register. [3]

1 VATCA 2010 s 6(1) 

2 VATCA 2010 s 6(2)

3 VATCA 2010 s 6(3)

Where provided by a recognised school, college, university, public body, or an exchequer-funded body, the following are exempt: [1]

  • children’s or young people’s education
  • school education
  • university education
  • vocational training or retraining.

In Revenue’s view:

  • These mean the prescribed curriculum at pre-school, primary school, post-primary school and third level institutions.
  • Education requires a clear teacher/student relationship and an organisational infrastructure to support the effective transfer of knowledge and skills from teacher to student. [2]
  • Education includes other activities taught in schools or universities in order to develop students’ knowledge and skills, provided such activities are not purely recreational.

Also exempt are:

  • Structured learning of an academic, artistic or sporting nature, which mirrors official curriculum content, for young people (under 18). e.g., children’s basketball lessons, gymnastic lessons, music lessons, swimming lessons; a summer school which supplements the official school education programme, e.g., classes for children about science and technology.
  • Private tuition by a teacher/sole trader covering school or university education. E.g., maths grinds.
  • Other vocational training and retraining.

The standard rate applies to:

  • Adult dance classes which are not fitness-centred, e.g., waltzing, foxtrot etc.
  • Judo lessons.
  • Karate lessons. [2]
  • Personal development.
  • Lecturing services, however, the provision of a lecturer from one college to another may be exempt from VAT on the basis that it is “closely related” to education. [3]

The reduced rate applies to health studio classes e.g.:

  • Aerobics classes.
  • Keep fit classes.
  • Pilates classes.
  • Yoga classes.
  • Zumba classes. [4]

1 VATCA 2010 Sch 1 para 4(2)

2 Revenue VAT rates database.

3 Case C-434/05 – Horizon College v Staatssecretaris van Financiën.

4 VATCA 2010 Sch 3 para 21(1)

A transfer of business (TOB) means a transfer of a totality business assets, even if the business has ceased, provided the assets constitute an “independent business undertaking”. [1]

The transferred assets must constitute an undertaking or part of an undertaking capable of being operated on an independent basis.

VAT is not chargeable on a transfer of business (TOB) as it is not regarded as a supply. [2]

The transfer of a property of itself, whether or not previously used for the purpose of a business, without any additional assets such as plant, machinery, goodwill, stock or an existing tenancy/licencing agreement, which together with the property would be capable of being used to independently carry out a business, would not fall within the TOB rules.

A transfer of a property that is the subject of a letting agreement comes within TOB, as the property and the lease are capable of constituting an independent undertaking.

A transfer of an property that is not subject to letting agreement a cannot come within TOB, regardless of how the property was used prior to its transfer.

The transfer of a let property to the tenant does not come within TOB as the transfer does not constitute an independent undertaking.

The transfer of the assets of a letting business which includes property which is part let, part vacant and part undeveloped, by a single vendor in one transaction to a single purchaser, falls within the TOB rules.

Where a number of persons co-own a let property, the transfer by one of the co-owners of an interest in the property, whether to another co-owner or to a third party, is treated as falling within the TOB rules. [3]

If a property is transferred VAT-free under the TOB rules, the transferee steps into the shoes of the transferor and takes over the transferor’s CGS liabilities. [4]

VAT may be reclaimed on services related to a transfer of business provided the main transaction would have been taxable but for the transfer of business rule. [5]

The standard rate applies to the sale of a franchise. [6]

The standard rate applies to a sale of goodwill [7] but goodwill sold in connection with a transfer of an amalgam of assets which together are capable of operating as a business on an independent basis qualifies for TOB and is not taxable.

1 Zita Modes Sarl v Administration de l’enregistrement et des domaines, ECJ 2004/C21/10.

2 VATCA 2010 s 20(2)(c) 

3 Revenue Tax and Duty Manual July 2018.

4 VATCA 2010 s 64(10)

5 VATCA 2010 s 59(2A)

6 Revenue VAT rates database

7 VATCA 2010 s 46(1)(a)

The zero rate applies to:

  1. Food for human consumption. [1]
  2. Intravenous tube food.
  3. Fruit drinks marked and marketed as suitable for babies. [2]
  4. Most bread including hot bread but not croissants, brioche etc.
  5. Food sold to travellers on board a boat or plane travelling to another EU State, for consumption on board that boat or plane. [3]

The standard rate applies to:

  1. Ice-cream, frozen desserts, frozen yogurts.
  2. Savoury snacks made from cereal or grain (e.g., cereal bars and breakfast bars) pork scratchings and and similar products (e.g., tortilla chips, bacon fries, scampi fries, vegetable crisps, vegetable chips, mignon morceaux.)
  3. Popcorn, potato crisps, potato sticks, potato puffs, salted or roasted nuts.
  4. Confectionery, i.e., chocolates, sweets, chocolate biscuits or wafers (but the reduced rate applies if supplied “in the course of catering”). [4]

Food and drink provided “in the course of catering”, i.e., in the course of operating a hotel, restaurant, public house, café, catering business, or a business that provides facilities for the consumption of food and drink, or by a vending machine is a service. [5]

The reduced rate applies to:

  1. Food provided “in the course of catering”; this includes ice cream, yogurt and frozen dessert; snacks made from cereal or grain, popcorns, crisps and salted or roasted nuts, chocolates, sweets and similar confectionery; biscuits, and cakes. [6]
  2. Food (that would otherwise be zero-rated) provided by a vending machine.
  3. Cakes, crackers,biscuits, wafers (not wholly or partly covered or decorated with chocolate).
  4. Bread which does not meet the strict definition of bread (e.g., brioche, cheese-breads, cheese bagels, crispbread, croissants, Maltana, etc). [7]
  5. Hot take away food – but hot bread is zero rated. [8]

VAT is not deductible on food. [9]

1 VATCA 2010 Sch 2 para 8(1)

2 Revenue VAT rates. The standard rate applies to fruit juice, but Revenue thinking appears to be that the zero rate applies to fruit juice for babies on the basis that it is “food.”

3 VATCA 2010 Sch 2 para 7(6)(b)

4 VATCA 2010 Sch 2 para 8(2)

5 VATCA 2010 s 25(2)

6 VATCA 2010 Sch 3 para 3(1)

7 VATCA 2010 Sch 3 para 3(5)

8 VATCA 2010 Sch 3 para 3(3)-(4)

9 VATCA 2010 s 60

The zero rate

applies to:

  1. Drink for human consumption. [1]
  2. Fruit drinks marked and marketed as suitable for babies. [2]
  3. Tea leaves and tea bags.
  4. Cocoa powder, coffee powder, coffee granules and coffee beans.
  5. Milk, milk preparations and extracts.
  6. Meat, yeast or egg preparations or extracts. [3]
  7. Drink sold to travellers on board a boat or plane travelling to another EU State, for consumption on board that boat or plane. [4]

The standard rate

applies to:

  1. Alcoholic drinks.
  2. Soft drinks, minerals, bottled water, aloe vera juice, creatine monohydrate, fruit juices, glucose drinks, sports drinks, syrups, drink concentrate and essences. The reduced rate applies to fruit juice supplied in the course of a meal. [5]

The reduced rate

applies to drink (apart from alcoholic drink, minerals and bottled water) supplied

  1. “in the course of catering” i.e., in the course of operating a hotel, restaurant, public house, café, catering business, or a business that provides facilities for the consumption of food and drink.
  2. By a vending machine. [6]
  3. Fruit juices supplied in the course of a meal. [7]

Providing drink “in the course of catering” or by a vending machine is a service.[8]

VAT is not deductible on drink. [9]

1 VATCA 2010 Sch 2 para 8(1)

2 Revenue VAT rates. The standard rate applies to fruit juice, but Revenue thinking appears to be that the zero rate applies to fruit juice for babies on the basis that it is “food.”

3 VATCA 2010 Sch 2 para 8(3)

4 VATCA 2010 Sch 2 para 7(6)(b)

5 VATCA 2010 Sch 2 para 8(2)

6 VATCA 2010 Sch 3 para 3(1)

7 VATCA 2010 Sch 3 para 3(2)

8 VATCA 2010 s 25(2)

9 VATCA 2010 s 60

A fixture is something that when installed, cannot be removed without causing structural damage to the building or damage to the item/fixture itself, for example:

  • Advertising hoarding.
  • Airdomes.
  • Air conditioning.
  • Attic ladder.
  • Basketball boards.
  • Basketball posts.
  • Bathroom suite ( bath, toilet, sink, shower).
  • Boiler.
  • Bulk milk tank.
  • Burglar alarm.
  • Canopy.
  • Carpets (stuck down).
  • Carpet tiles (stuck down).
  • Central heating pump.
  • Central heating system.
  • Chimney.
  • Cladding.
  • Cold room.
  • Conservatory.
  • Counter (e.g., bar counter).
  • Curtain rails.
  • Doors.
  • Door locks.
  • Double glazing.
  • Draught excluder.
  • Ducting.
  • Fire alarm (does not include smoke detector).
  • Fitted kitchen units.
  • Fitted wardrobe.
  • Fencing (permanent).
  • Fire escape.
  • Fireplace.
  • Fluorescent lighting (but bulbs and lighting suspended by chain from a ceiling do not qualify).
  • Fuseboard.
  • Garden shed.
  • Gates.
  • Generator (fixed).
  • Glass.
  • Glasshouse.
  • Greenhouse.
  • Hayshed.
  • Headstone.
  • Heaters (fixed).
  • Immersion heater.
  • Insulation.
  • Intercom.
  • Kitchen range (if it forms part of the central heating system).
  • Lift (elevator).
  • Locks.
  • Milking parlour.
  • Monument.
  • Oil tank.
  • Pigeon boxes.
  • Pelmet.
  • Presses (built-in).
  • Radiators.
  • Railings. But racecourse railings are not regarded as fixtures. [1]
  • Recessed lighting.
  • Roller shutters. But roller blinds are not regarded as fixtures. [1]
  • Safes.
  • Solid fuel cooker.
  • Street lighting.
  • Television aerial. [2]
  • Windows.

The reduced rate applies to the supply and installation of fixtures, subject to the two-thirds rule. [3]

The standard rate applies to the supply only of the above items.

The letting of fixtures apart from the building in which they are contained is not exempt. [4]

The separate letting of fixtures consisting of machinery or business installations attached to property (e.g., an elevator) is subject to VAT at the rate applicable to the hire of movable goods of the same kind. [5]

1 Revenue VAT rates

2 Maye v Revenue Commissioners III ITR 332; [1986] ILRM 377

3 VATCA 2010 Sch 3 para 9(1), 15(2)

4 VATCA 2010 Sch 1 para 11

5 VATCA 2010 s 50(3)

The reduced rate applies to hot take-away food, e.g., hot chicken, fish and chips.

Hot take-away food includes cooked food which is supplied while hot for the purpose of consumption while hot, that is, at a temperature above the ambient air temperature. It includes items such as burgers which consist of hot meat enclosed in a cold bun and similar food.

The zero rate applies to freshly baked bread which may be hot at the time of purchase. [1]

The goods threshold applies to a trader whose turnover is derived as to 90% or more from the supply of goods.

In calculating the 90%, “goods” does not include goods sold at the reduced rate (e.g., takeaway fish and chips) or the standard rate which have been made from materials charged to him/her at the zero rate (fish and potatoes). This means the services threshold (€37,500) applies to takeaway outlets. [2]

1 VATCA 2010 Sch 3 para 3

2 VATCA 2010 s 6(1)(c)(ii)

“Immovable goods” means land. [1]

The word “land” includes houses and buildings, land covered by water and any estate, right or interest in or over land. [2] This includes a grave or burial plot. [3]

The reduced rate applies to work on immovable goods (e.g., building and construction services) including the supply and installation of fixtures, subject to the two-thirds rule:

  • Attic conversion.
  • Attic insulation.
  • Bitumen laying.
  • Bituminous roadbinder laying.
  • Bog drainage.
  • Bricklaying.
  • Carpentry.
  • Damp proofing.
  • Deep ploughing of land (regarded as land reclamation).
  • Demolition.
  • Digging (including archaeological digs).
  • Dredging.
  • Drilling.
  • Dry rot treatment.
  • Electrical work.
  • Excavation work.
  • Flameproofing.
  • Floor sanding.
  • Floor sealing.
  • Gardening.
  • Glazing.
  • Grass cutting.
  • Hedge cutting.
  • Hedge trimming.
  • Hire with operator of: bulldozer, compactor, digger, excavator, grader, hedge cutter, JCB, kango hammer, lawnmower, traxcavator. etc.
  • Land drainage.
  • Land reclamation. Including removal of weeds, scrub, bracken, pests etc.
  • Landscaping. This includes laying of lawns, paths, patios, planting of trees and hedges etc.
  • Lawn mowing.
  • Maintenance of plants in the ground.
  • Plastering.
  • Polishing.
  • Plumbing.
  • Resurfacing.
  • Road cleaning.
  • Roofing.
  • Rotovating.
  • Rustproofing (gutters, pipes, railings).
  • Wallpapering. [4]

The reduced rate also applies to routine cleaning of private dwellings [5] and of non-residential property. [6]

The standard rate applies to:

  • Architectural and design services.
  • Fumigation (pest control).
  • Property management services. [7]

1 VATCA 2010 s 2(1)

2 Interpretation Act 2015 Schedule

3 VATCA 2010 Sch 3 para 15(1)

4 VATCA 2010 Sch 3 para 9(1), 15(2)

5 VATCA 2010 Sch 3 para 9(2)

6 VATCA 2010 Sch 3 para 15(3) 

7 VATCA 2010 s 46(1)(a)

The reduced rate applies to repair or maintenance of movable goods, or modification of used movable goods, e.g.:

  • Battery charging.
  • Car wash.
  • Curtain cleaning.
  • Curtain repair.
  • Dyeing of used goods.
  • Dry cleaning.
  • Engraving.
  • French polishing.
  • Gas conversion (used vehicle).
  • Repair of gold items.
  • Ironing service.
  • Launderette.
  • Laundry service (but the standard rate applies to the hire of linen).
  • Maintenance of potted plants.
  • Panel beating.
  • Piano tuning.
  • Picture restoration.
  • Polishing (e.g., furniture, silverware, brass, car).
  • Reconditioning.
  • Repolishing used furniture.
  • Respraying a used car.
  • Restoration of damaged books and documents.
  • Resurfacing (e.g., snooker table).
  • Rustproofing a used car. [1]

The reduced rate also applies to:

  • Alteration of used movable goods.
  • Minor repairs to bicycles, shoes or leather goods, clothing or household linen (e.g., bleaching linen). [2]

The reduced rate also applies to repair work on immovable goods including the supply and installation of fixtures, subject to the two-thirds rule. [3]

The standard rate applies to:

  • Accessories, attachments, batteries, tyres, tyre tubes or tyre flaps, supplied in the course of a repair/service, for example, bike tyres and car tyres.
  • The National Car Test (NCT) – it is not regarded as a repair. [1]

The zero rate applies to repair/maintenance of:

  • International commercial aircraft. [4]
  • Aircraft equipment. [5]
  • Ships. [6]

Regulations may provide for the repayment of VAT in relation to such repairs. [7]

1 VATCA 2010 Sch 3 para 20

2 VATCA 2010 Sch 3 para 13(2)

3 VATCA 2010 Sch 3 para 9(1), 15(2)

4 VATCA 2010 Sch 2 para 4(2)

5 VATCA 2010 Sch 2 para 4(4) 

6 VATCA 2010 Sch 2 para 4(3)

7 VATCA 2010 s 104(5)

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