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Unusual VAT Question

  • 24-01-2019 7:13pm
    #1
    JohnCleary
    Registered Users, Registered Users 2 Posts: 10,209 ✭✭✭✭


    Hi all,
    Let me first explain my circumstances...

    I am a sole trader, became VAT registered on 1/1/19 - no problems so far and learning day by day.

    My main business is IT related, so this is why I became VAT registered.

    Now, I also run a part-time business April - September annually. (sightseeing boat charter). It is a VAT exempt business (I know this for sure, got clarification from Revenue). So, with this, I cannot claim VAT back, but I do not charge VAT.

    However, someone told me that as a sole trader, it's me whose VAT registered, rather than the IT business (this makes sense, my VAT no. is my PPS no.)

    For the IT business, I understand the 0% VAT Intra-EU (and how to account / submit on my VAT3) - no problems there.

    My query: For the boat charter business (VAT exempt), can I still pay 0% VAT on Intra-EU purchases, which are solely a business expense (ie. lifejackets) - Almost all of my expense purchases are from the UK, so would be nice to pay 0% VAT.
    If the answer is YES, presumably I still account for it in my VAT3 return (T1 / T2 and then the 'Goods from Intra-EU Countries')

    Many thanks.


Comments

  • #2
    thegolfer
    Registered Users, Registered Users 2 Posts: 346 ✭✭thegolfer


    JohnCleary wrote: »
    Hi all,
    Let me first explain my circumstances...

    I am a sole trader, became VAT registered on 1/1/19 - no problems so far and learning day by day.

    My main business is IT related, so this is why I became VAT registered.

    Now, I also run a part-time business April - September annually. (sightseeing boat charter). It is a VAT exempt business (I know this for sure, got clarification from Revenue). So, with this, I cannot claim VAT back, but I do not charge VAT.

    However, someone told me that as a sole trader, it's me whose VAT registered, rather than the IT business (this makes sense, my VAT no. is my PPS no.)

    For the IT business, I understand the 0% VAT Intra-EU (and how to account / submit on my VAT3) - no problems there.

    My query: For the boat charter business (VAT exempt), can I still pay 0% VAT on Intra-EU purchases, which are solely a business expense (ie. lifejackets) - Almost all of my expense purchases are from the UK, so would be nice to pay 0% VAT.
    If the answer is YES, presumably I still account for it in my VAT3 return (T1 / T2 and then the 'Goods from Intra-EU Countries')

    Many thanks.

    In short no.

    Though you are now vat registered, you would have to account for the vat on the charter business.

    So, acquire the life jacket's from the UK, but then pay the VAT at 23% in Ireland. Still the same price, just you pay the VAT in Ireland to Revenue.

    Also your accountants fees these can now be split between the exempt and vatable IT business, and claim back VAT. Other dual costs can also be claimed back for Vat purposes where both businesses use the service.


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