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VAT & providing services to another EU country

  • 30-01-2012 10:02pm
    #1
    mrmls
    Registered Users, Registered Users 2 Posts: 6 ✭


    Hello,

    I'm a bit confused here. If I as a sole-trader provide services to a company in another EU country, who pays VAT?

    I have seen this, Table 2.1. . In my case, I figured, is the first row: I am from Ireland, the company is in another EU country, it is a business entity and the place of supply is that another country. There is no option that the place of supply is Ireland, so I suppose that automatically services are counted to be supplied overseas. 1) Is this correct?

    So, the main thing: it says "No Irish VAT". 2) Does it mean that I don't pay VAT, but the company pays it in its country?

    3) Does it matter if it looks like I am not going to exceed that 37K euro turnover limit to be VAT-taxable, but the company definitely exceeds its limit in its country?

    And the last one - 4) is this the case of possible reverse charge? Do I need to think about this at all or the company will sort this out for itself?

    Thanks in advance.


Comments

  • #2
    smeharg
    Registered Users, Registered Users 2 Posts: 300 ✭✭smeharg


    Firstly, none of this is relevant to you if you are not required to register for VAT. Secondly, these are general rules and there are exceptions. Thirdly, if you are required to register for VAT you should take proper professional advice to make sure you are doing it right.
    mrmls wrote: »
    ...
    I am from Ireland, the company is in another EU country, it is a business entity and the place of supply is that another country. There is no option that the place of supply is Ireland, so I suppose that automatically services are counted to be supplied overseas. 1) Is this correct?

    The recipient company must be registered for VAT it its home country. It must provide you with that its VAT number and you must validate it. If it is not VAT registered then the business to consumer rules apply.
    mrmls wrote: »
    ...
    So, the main thing: it says "No Irish VAT". 2) Does it mean that I don't pay VAT, but the company pays it in its country?
    ...

    You would not charge Irish VAT on your invoice to the Company provided the requirements in (1) above have been met. The recipient company looks after the VAT in its own country - you need not worry about it.
    mrmls wrote: »
    ...
    3) Does it matter if it looks like I am not going to exceed that 37K euro turnover limit to be VAT-taxable, but the company definitely exceeds its limit in its country?
    ...

    As I stated first if you don't need to register in Ireland none of this matters. The recipient company's turnover is of no relevance.
    mrmls wrote: »
    ...
    And the last one - 4) is this the case of possible reverse charge? Do I need to think about this at all or the company will sort this out for itself?
    ...
    You don't need to worry about the reverse charge. That is the recipient company's concern. You would only apply a reverse charge if you were buying goods/services from anothe EU country.


  • #3
    mrmls
    Registered Users, Registered Users 2 Posts: 6 ✭mrmls


    Thanks a lot. I will contact a professional when such need arises.


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