Ireland Brexit postponed accounting for import VAT
- Nov 3, 2020 | Richard Asquith
Ireland is introducing a facility for VAT registered businesses to avoid the payment of import VAT to help soften the effects of the UK leaving the EU VAT regime after 31 December 2020. The measure was originally proposed in February 2019 in the run-up to the April 2019 Brexit. Many EU states offer postponed accounting on VAT imports.
The House of Representatives has accepted the Withdrawal of the United Kingdom from the European Union (Consequential Provisions) Bill
The existing Irish VAT Consolidation Act 2010 is being amended by the Bill to allow importers to instead delay the declaration of import VAT to their next VAT return. At the same time, they can reclaim the import VAT, and thus net of the amount due and avoid a cash payment. The measure is to help importers of goods from the UK, Ireland’s largest trading partner, from suffering the cashflow impact of having to pay import VAT since the UK will be out of the zero-rating EU VAT system.