The standard rate of Irish VAT will be temporarily reduced from 23% to 21% for a six-month period from 1 September 2020 to 28 February 2021.
VAT should be charged at 21% on invoices issued on or after 1 September 2020 to VAT registered customers.
For supplies to unregistered persons, it is the rate at the time of the supply i.e. goods or services which are actually supplied to consumers prior to 1 September 2020 are taxable at 23% even though they may be invoiced after 1 September 2020.
A trader on the cash receipts basis should show the VAT rate which applies at the date of the supply, not the date of receipt of payment.
A VAT credit note relating to a supply of goods or services to a VAT registered customer should show VAT at the rate in force at the time the original invoice was issued.
Any VAT credit note to a consumer should show VAT at the rate in force at the time of the supply.
Advance payments, including deposits, received from VAT-registered persons can be categorised as follows:
- Suppliers who account for VAT on an invoice basis: the appropriate VAT rate is the rate in force at the time the invoice relating to the advance payment is issued, or ought to have been issued, whichever is the earlier.
- Suppliers who account for VAT on a cash receipts basis: the appropriate VAT rate is the rate in force at the time of the advance payment.
An advance payment received from an unregistered person is subject to VAT by reference to the rate in force at the time of the advance payment.