VAT rate on glasses (spectacles)

optician2

I would be grateful if someone could verify the rules on VAT rates on spectacles

revenue.ie/en/practitioner/ebrief/archive/2007/no-372007.html

Just a brief overview.
An eye exam is considered a service and is exempt from VAT.
Dispensing glasses is the act of fitting glasses on customers, including measurements, adjustments etc

My understanding from the above link is that a pair of glasses costing €200 to the customer can have the costs broken down to €100 dispensing fee and €100 for the glasses.
The dispensing fee part would be exempt from VAT and the glasses part would have the full 23% VAT rate applied giving an effective overall rate of 11.5% on the €200.

Is my intepretation correct?
Rang the VAT office to verify today and was told that the full rate of 23% should apply to the €200 in this example but I was not convinced that he was confident about what he was saying.

Any help on this would be much appreciated.

optician2

Any ideas?

Alan Shore

I'd be with you €100 exempt €100 @ 23%.

optician2

Alan Shore wrote: »

I'd be with you €100 exempt €100 @ 23%.

Thanks Alan.

optician2

Called a different revenue office that agreed that
half the value is seen as a dispensing fee and would be exempt.
However he was just reading the link I have in my op and using that as his reference. He had never heard of it before.
Now I have gotten two opposing pieces of advice from two different vat offices.

Saw this link today that seems to suggest that they were looking to end this loophole.
Independent.ie/business/irish/opticians-50m-is-one-in-the-eye-for-taxman-26360326.html

what's the best place to get a definite answer?

relax carry on

optician2 wrote: »

Called a different revenue office that agreed that
half the value is seen as a dispensing fee and would be exempt.
However he was just reading the link I have in my op and using that as his reference. He had never heard of it before.
Now I have gotten two opposing pieces of advice from two different vat offices.

Saw this link today that seems to suggest that they were looking to end this loophole.
Independent.ie/business/irish/opticians-50m-is-one-in-the-eye-for-taxman-26360326.html

what's the best place to get a definite answer?

Write to your local vat section asking for a determination in writing confirmed by the Vat interpretation section.

Alan Shore

This issue has been going on for years. A number of years around 2009 or 2010 revenue paid back VAT due to a change from fully taxable to 50% taxable 50% exempt.

http://www.revenue.ie/en/practitioner/tax-briefing/archive/65/tb12.htm

I'm not aware of a change.