CLAIMING VAT FROM START UP EXPENSES

suey71

So I got my Business Name sorted out. Thank you for all your advice on that one.

Now I need some advice on the following.

I want to register for VAT, but when do I do it?

What I mean is, I have my start up capital ( thank you Credit Union). Now I want to get a Website sorted and import stock, (from EU countries).

I want to be able to reclaim the VAT I'll be paying on the website and on my stock, but to have a website built and stock brought in will take about 1 month+-.

1. If I register for VAT now can I import my stock and have my website built minus the VAT (save myself money straight off) or do I have to pay the VAT and wait, say 2 months to get a rebate?

2. What happens if I get my website built and buy stock and then register for VAT in the near future, can I get the VAT back?

I know its a simple enough process and all filling out the TR1 form, but I dont want to pay VAT after only 2 months, when I will be probably up and running only a wet day.

When do I register?

Thanks.

I just read some relevent advice posted by TomBull82 on a similar thread about VAT and Start ups. Thanks Tom.

tombull82

No Prob..:)

Have a look on revenue.ie and search VAT, loads comes up,

I even found that since this year if you buy a new Car you can claim 20% of the VAT back if reg'd.
Thats interesting.....I just need the money for a new car now..:)

AndyJB

tombull82 wrote: »

No Prob..:)

Have a look on revenue.ie and search VAT, loads comes up,

I even found that since this year if you buy a new Car you can claim 20% of the VAT back if reg'd.
Thats interesting.....I just need the money for a new car now..:)

Hi,
From past experience you can only reclaim VAT on commercial vehicles (vans etc) not regular cars.

On the OPs issue when to reg for VAT.

You should reg for VAT now as it could take a few weeks for VAT man to issue paperwork. I'm not sure if you can reclaim VAT on invoices received during VAT application period.

I've always found my local VAT office very helpful, call yours with any questions.

Best of luck

tombull82

AndyJB wrote: »

Hi,
From past experience you can only reclaim VAT on commercial vehicles (vans etc) not regular cars.

Correct from past experience, but As I said as of THIS year 2009 you can also claim back 20% of the VAT on a regular car. (if its been used for business 60% of the time)

tombull82

you would be able to claim the VAT back on the stock for resale that you are holding which you bought before registering but not on services used.

ghosttown

So if I'm a sole trader, and have a car loan from last year (before I became a sole trader), can I include the VAT portion of the car loan in my VAT returns now as I use it for business ? Thanks

tombull82

ghosttown wrote: »

So if I'm a sole trader, and have a car loan from last year (before I became a sole trader), can I include the VAT portion of the car loan in my VAT returns now as I use it for business ? Thanks

I'm afraid not. it has to be 09 reg and under 154 carbons

ghosttown

Thanks Tom, shame about that, but won't exactly have me rushing out to buy today !! However, good information, as was thinking of buying next year, perhaps 3/4 year old, will now start looking at 09's if this swings it in their favour. How do I work out what cars are under 154 carbon ? Just ask the garage I assume ?

tombull82

i think i seen a list before, i'll have a look for it. But i know alot of cars are under it even the 2.2 honda accord as far as i remember

larsson7

Suey,
An important point not mentioned but you may already know, you can only claim back Irish VAT.
If you're buying from EU and have a VAT number ensure you give this VAT number to the EU company and they will not charge VAT.
If as you say you are importing at the moment and paying VAT inclusive you can only claim VAT back off the authorities from country of purchase and then only if its over a certain amount, difficult process.
So if buying from EU try get VAT no. first and ensure you are then buying at VAT exclusive price

koenig_dublin

Thank you guys, it is very useful info that you shared here.

Please advise if i import some material from China to EU to manufacture some products and then sell them in Ireland and UK, how VAT should be handled?
The turnaround should be less then 75k euro.

Tomthepost

One tip I was given about registering for VAT was not to register until you have started trading more than 1/12 of 75k (6,250 euro) over the course of a month. Not sure how good that advise actually is to be honest.
As far as pre-trading expenses go can anyone tell me how far back can one reclaim VAT from?

larsson7

Tom you can't go back.
For example if you were doing your first bi monthly return for Nov - Dec 09 only purchase invoices dated from 1st November 2009 on can be included in this return.

Skid

tombull82 wrote: »

Correct from past experience, but As I said as of THIS year 2009 you can also claim back 20% of the VAT on a regular car. (if its been used for business 60% of the time)

This change hasn't received much publicity for some reason. 20% of the VAT isn't huge but every little helps, as they say.
I think a lot of businesses are missing out on this, bit more info here ...

http://www.revenue.ie/en/tax/vat/refunds/vat-reclaims-faqs.html

Lorelei

I'm afraid the answer from Jarsson 7 (Post no 7 ) is incorrect.
1. A company supplying you from outside of Ireland does not have to supply you free of VAT it is up to the supplier himself.
2. If he does require VAT at his national rate, you claim that back as VAT paid on your normal VAT return. At the end of the year you will have to show what rates of VAT have been paid, charged. I think in fact that the new VAT returns actually have a space to put in where the supplier orginates i.e. country along with the rate and amount of VAT paid.
Since mid 2009 I am buying from suppliers who dont charge VAT. Up till then my supplier was charging UK VAT I never waited but had refunds immedaitely. Obviously having suppliers who are not charging VAT helps cash flow.

kenbrady

Lorelei wrote: »

I'm afraid the answer from Jarsson 7 (Post no 7 ) is incorrect.
1. A company supplying you from outside of Ireland does not have to supply you free of VAT it is up to the supplier himself.
2. If he does require VAT at his national rate, you claim that back as VAT paid on your normal VAT return. At the end of the year you will have to show what rates of VAT have been paid, charged. I think in fact that the new VAT returns actually have a space to put in where the supplier orginates i.e. country along with the rate and amount of VAT paid.
Since mid 2009 I am buying from suppliers who dont charge VAT. Up till then my supplier was charging UK VAT I never waited but had refunds immedaitely. Obviously having suppliers who are not charging VAT helps cash flow.

You are wrong

1. A company within the EU, has to supply you with goods vat free. If you are vat registered and provide them with your vat number.

2. You cannot claim vat paid abroad on your normal vat return. You have to claim it back from the country where it was paid.

If you were doing what you claim in 2, you are in for serious trouble and big fines when you get a vat audit.

Lorelei

I'm sorry check your VAT return form the bottom left corner shows VAT paid to other EU countries. My annual VAT went through OK in 2007 and 2008.
A company wishing to charge VAT at their national rate does not have to sell to you VAT free. They don't have to deal with you at all.
Call the VAT department in Limerick or your local office.
Regards

kenbrady

Lorelei wrote: »

I'm sorry check your VAT return form the bottom left corner shows VAT paid to other EU countries.

No it does not. That is for the total value of goods sent/received from other eu countries.
When you buy goods in eu countries and are not charged vat. You have to account for the vat in your returns, even though it does no exist.

Lorelei wrote: »

My annual VAT went through OK in 2007 and 2008.

The problem will only arise when you get audited.

Lorelei wrote: »

Call the VAT department in Limerick or your local office.
Regards

You call the vat office and ask them.
I bought X in the UK. They charged me vat on it. Can I claim the vat back in my monthly return ?

Lorelei

OK
my advice to ring the tax office in Limerick was not meant for you rather for the origian poster.
Having checked again with my correspondance ref VAT buying from UK etc, I'm happy.

I would advise anyone with questions reference taxation to talk to the revenue I have found the Revenue authorities in Ireland, the UK and Germany extremely helpful.

kenbrady

Lorelei wrote: »

OK
my advice to ring the tax office in Limerick was not meant for you rather for the origian poster.
Having checked again with my correspondance ref VAT buying from UK etc, I'm happy.

I would advise anyone with questions reference taxation to talk to the revenue I have found the Revenue authorities in Ireland, the UK and Germany extremely helpful.

If you are doing what in claimed in regard to UK vat. It is 100% illegal and will land you in big trouble. You and your correspondent are wrong.

Taty666

Hi there!
I have a question about Vat also.
I`m sole trader, not reg for VAT, I`m selling books, it`s zero rate Vat isn`t?
So when I buy my stock in Germany (most of it books), they charge me 5-19% Vat, even they know that I`m not reg for VAT.
Whats the best option for me? Reg for Vat and try to return it? But I can`t charge for books when I sell them in Ireland...
And why on Vat3 form is that EU paid VAT if it`s illegal to return it?
I`ll try to contact my local revenue office to find out.