Value Added Tax Consolidation Act 2010 section 86

Special provisions for tax invoiced by flat-rate farmers

Section 86 provides for the flat-rate addition scheme, under which unregistered farmers add a percentage-based addition to the price of their agricultural produce and services to compensate them for VAT incurred on farming inputs.

• A flat-rate farmer who supplies agricultural produce or an agricultural service must issue an invoice showing the consideration and a flat-rate addition of 4.5 per cent, calculated on the consideration exclusive of the addition itself.
• The flat-rate addition is recoverable by the farmer as part of the price for the transaction, and the farmer does not remit it to Revenue; the purchasing business pays it to the farmer and reclaims it as input VAT in the normal way.
• The flat-rate addition does not apply to any agricultural produce or service of a kind specified in a ministerial order made under section 86A; from 1 September 2025, stock minding, rearing and fattening services during the production of broiler chickens are excluded.
• Where contra payments or multiple supplies arise, the flat-rate addition is calculated only on the amount attributable to the qualifying agricultural produce or service, not on net settlement figures or non-qualifying elements.