Value Added Tax Consolidation Act 2010 section 45

Adjustment and recovery of consideration

Section 45 deals with the adjustment of contract prices when the VAT rate changes between the date of agreement and the date of supply, and with the recovery of VAT shown separately on invoices.

• Where a VAT rate change occurs after a contract is agreed but before the supply takes place, the contract price is automatically adjusted upward or downward by the amount of the VAT change, unless the parties agree otherwise.
• The right of adjustment applies equally where a supply moves from taxable to exempt (or zero-rated), or from exempt (or zero-rated) to taxable.
• Where an accountable person issues an invoice showing the VAT separately, that VAT is treated as part of the consideration for the supply and is legally recoverable as such.
• The recovery right for separately stated VAT applies only where the invoice is issued to another accountable person in the proper form and contains all the particulars required by regulations.