Postponed Accounting for VAT on imports is available from 1st January 2021. It provides a major cash-flow benefit for traders who import goods from all non-EU countries into Ireland.
Postponed Accounting enables you to self-account for import VAT on your VAT returns rather than having to pay import VAT upfront. It also allows you to reclaim import VAT at the same time as it is declared on a VAT return, subject to normal rules on deductibility.
There are two steps to ensure you can apply postponed accounting to your imports:
Step One – Make sure your business is entitled to use Postponed Accounting
- Traders who were registered for both VAT and Customs & Excise (C&E) with Irish Revenue at 11:00pm on 31 December 2020 have been given automatic entitlement to Postponed Accounting.
- VAT registered traders who were not registered for C&E at 11:00pm on 31 December 2020 and who wish to import goods into Ireland must register for C&E (i.e. must obtain an Irish EORI number). Once registered for C&E, they will be given automatic entitlement to Postponed Accounting.
- After 11:00 pm on 31 December 2020 all new intra-EU VAT applicants must get their Irish VAT number issued and then must register for C&E. When both the VAT and C&E registrations have been approved the applicant must request access to Postponed Accounting from Revenue.
- After 11:00 pm on 31 December 2020 domestic-only VAT applicants who acquire goods from countries outside of the EU VAT area must apply to Revenue for Postponed Accounting and submit certain supporting documentation. Domestic-only VAT applicants will receive confirmation from Revenue when their Postponed Accounting application has been granted. Applicants will not have access to the Postponed Accounting facility prior to this confirmation.
Step Two – Make sure the electronic customs import declaration is completed correctly
- The appropriate fields must be completed on the customs import declaration or you may be required to pay import VAT upfront.
- Revenue have issued guidance on exactly what needs to be inputted on the AIS and AEP systems.
- If you do not complete the customs import declaration yourself, you should tell your supplier or customs agent that you wish to avail of postponed accounting for import VAT and ensure that the customs import declaration indicates this to Revenue.
For further assistance, please contact Siobhán O’Hea, Partner in our Tax Services Department.