vat rates

yankinlk

got some conflicting advice...

i setup as a sole trader and have a 6 month contract for doing network engineer/feild engineer work. i charge my "customer/employer" a daily rate and invoice at the end of the month.

what rate should i be charging them? they suggested that it be 13.5 as i i providing a service - however i cant find it anywhere on revenue.ie

i charge 21 for any goods i supply to them in the course of my work.

also, i applied for my vat number at the start, but it took a good few days/weeks to arrrive (ended up being my pps number) i invoiced them with vat, but they refused to pay saying it was illegal to charge it if i had no vat number yet, however i got a vat3 form in the mail right away after getting my vat number and it covers the period that i invoiced them for?

are they pulling a fast one on me?

seamus

Right, I'm not accountant, though I have seen my fair share of accounts....

Originally posted by yankinlk
what rate should i be charging them? they suggested that it be 13.5 as i i providing a service - however i cant find it anywhere on revenue.ie

Afaik, services are charged at 13.5%, goods are charged at 21%.

also, i applied for my vat number at the start, but it took a good few days/weeks to arrrive (ended up being my pps number) i invoiced them with vat, but they refused to pay saying it was illegal to charge it if i had no vat number yet, however i got a vat3 form in the mail right away after getting my vat number and it covers the period that i invoiced them for?

are they pulling a fast one on me?

It's illegal to charge someone VAT, if you're not registered for it. However, since your VAT3 form tells you that you are VAT-registered for the period since you started, you are perfectly legal (and obliged, probably) to charge VAT from the first day specified on your VAT3.
If you issued invoices charging VAT, before you got your VAT3, and there's still a dispute over it (i.e. they haven't coughed up), issue them with a revised invoice for the same work, with your VAT number clearly marked.

Kernel32

When I contracted last year, using my own limited company I charged 21%. That is what I was told by my accountant and by the CPL whom I was billing on behalf of the company I was actually doing the work for.
I was also without a VAT number for a while. My first few invoices did not have VAT but once I got my number I did a VAT only invoice that referenced the firs t invoices.

yankinlk

cheers lads, i rang the revenue up today to make sure and they said yes, charge 21.

Victor

Be aware that sole traders must have more than one contract per year. If you are habitually employed by only one client year in, year out, Revenue will deem you an employee.

They probably were BSing you on the 13.5% because they either can't claim back the VAT (banks / financial services and a few other can't claim back VAT) or want to do a scam.