2016 brought a few changes regarding VAT. The recent VAT developments refer to return of trading details, the management of special investment funds, VAT fraud and more.

Return of trading details(RTD)

Regarding the return of trading details(RTD), eBrief 50/16 outlines details of the filling process. The RTD is an annual statistical return that must be filled by all VAT-registered traders. It shows an analysis of sales and purchases at different VAT rates. Revenue is entitled to withhold tax refunds where the taxpayer has outstanding RTD. The updates to the RTD filing process in ROS refer to:

• The introduction of a facility to amend already-filed RTDs
• An automatic validation check performed by ROS against the VAT3 returns filed during the year.
• The outstanding RTDs will be shown on the list of outstanding returns for agent/user

Management of special investment funds

eBrief No.63/16 provides links to two new VAT manuals, which update Revenues guidance on the VAT exemption for management of special investment funds (SIFs).

The first manual confirms that investment advisory services qualify for VAT exemption provided the services are specific to and essential for the management of the fund.

The second manual updates Revenue guidance in relation to the scope of VAT exemption for the management of SIFs. The manual also helps determine the VAT treatment of the management of self-directed life assurance bonds and equivalent products sold and managed from Ireland into other jurisdictions, which are the subject to the local regulatory and tax requirements of those jurisdictions.

Protect your Business from Becoming Involved in VAT fraud

Revenue have issued an e-Brief outlining the risks of participating in transactions connected to a VAT fraud and providing guidelines to help avoid becoming involved in such transactions.

Cancellation of a VAT registration number

The VAT Consolidation Act 2010 (VATCA) was amended by Finance Act 2015 to include section 108D. This section provides that where a VAT registration number is cancelled, the Revenue Commissioners may advise the suppliers to the business to whom the cancelled number relates, of the cancellation.

Construction Sector

Revenue has increased its focus on compliance risks in the Construction Sector. The focus will be on how the VAT reverse charge is being operated. Penalties will be applied where appropriate.