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New Business tax query

  • 17-08-2009 5:11pm
    #1
    soozyq
    Closed Accounts Posts: 26 ✭


    Not sure if I am in the right forum or not but I thought I would give this one a try.
    I have recently set up an office offering various services (Architectural, CAD, Web Design) and initially I thought I would only be getting work in Ireland. Now I have managed to get some work from outside the State (Australia) and wondered if there would be a different tax regulating this. I will be getting paid in Euros if that make a difference and I am registered as a sole trader. Any advice would be appreciated.


Comments

  • #2
    MrMatisse
    Closed Accounts Posts: 1,743 ✭✭✭MrMatisse


    Makes no difference as far as i know. You still charge vat and income is still taxed as income as normal.


  • #3
    dbran
    Registered Users, Registered Users 2 Posts: 2,094 ✭✭✭dbran


    Hi

    It does make a difference.

    You will still be taxed in Ireland as you are a resident of Ireland. I do not know anything about Australian tax but I suspect you are not resident over there, you will have no exposure to Australian tax.

    However if you are invoicing to customers in Australia, then as you are providing a 4th schedule service (electronically supplied services) to customers outside the EEA you should not be charging them Irish VAT ie zero rated

    Dbran.


  • #4
    soozyq
    Closed Accounts Posts: 26 ✭soozyq


    Hi Dbran,
    Thanks for that. I am indeed residing in Ireland so it seems the Zero VAT rate applies. I have just been reading the 4th schedule service on the the revenue. Its very thorough. Thanks for your help


  • #5
    kerplunk.
    Closed Accounts Posts: 25 ✭kerplunk.


    Sorry to come in on your thread but I have a related question, with 4th shedule services the revenue site says that a business customer based in Ireland who receives a service from a supplier outside of the EU, then the customer is liable for the Irish VAT -

    Does this mean that if I purchase an electronic service from a company in the USA for €10 that I should enter it into my accounts as if I had paid €10 + €2.15 vat? this does not seem right as I would then be claiming back VAT that I had not paid - so do I alternatively charge myself €2.15 VAT and then claim it back? this seems to be a pointless exercise as one transaction cancels out the other. Am I interpreting the revenue guidelines incorrectly?


  • #6
    dbran
    Registered Users, Registered Users 2 Posts: 2,094 ✭✭✭dbran


    Hi

    This is correct. If you are VAT registered there is no net effect to the VAT that you pay and it is just a clerical exercise on your VAT return.

    However if you are not entitled to register for VAT then you must now register for VAT for the purpose of receiving 4th schedule services and pay over the VAT to revenue as you cant claim the relevant VAT back as a credit.

    dbran


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