• Value Added Tax is a sales tax applied to goods and services supplied in Ireland.Irish flag with shamrock image by Sophia Winters from Fotolia.com
  
  Value Added Tax, or VAT, is a sales tax that Ireland applies to the sales of goods and services in the country. Ireland is a member of the European Union, or EU, and the application of VAT to sales of goods and services in member countries is a requirement of EU membership. Member countries are free to set their own rules relating to VAT collection and administration, and in Ireland, VAT rules are administered by the Irish department of Tax and Customs.
  
  

VAT Registration

• In Ireland, a business must register for VAT if its turnover, meaning sales, exceeds a certain threshold. The thresholds differ, depending on the nature of the business, so that, for example, a business involved in supplying services, such as an accountant supplying bookkeeping and accountancy services, must register for VAT if the business has an annual turnover of €37,500 or above. A business supplying goods, such as a retailer selling toys, must register for VAT if its annual turnover is greater than €75,000. If a business supplies both goods and services, the threshold for VAT registration is €75,000, if the supply of goods accounts for 90 percent or more of the business's turnover.
  
  Farmers do not have to register for VAT, and a business that does not supply goods or services within Ireland, but only makes sales to other states, do not have to register for VAT.
  
  

VAT Repayments

• A registered business may reclaim the VAT component of the price of any goods or services it makes for the operation of the business. Usually, the VAT reclaimed is offset against the amount of VAT due for any VAT accounting period. Typically, VAT-registered businesses file VAT returns every three months, and VAT can be reclaimed for purchases made during that period.
  
  VAT repayments for the purchase of vehicles are conditional on a number of factors. First of all, the vehicle must be purchased from a VAT-registered business, and VAT must be applied to the purchase price. The vehicle must be purchased for the exclusive use of the business, so that if the vehicle will be for personal use, as well as for business use, you cannot claim back the VAT component of the purchase price unless business use of the vehicle accounts for over 60 percent of the total vehicle use.
  
  

VAT Invoices

• Any VAT-registered business must issue a VAT invoice when it supplies goods or services to certain specific customers. For example, a VAT invoice must be issued if the customer is another VAT-registered business, a department of the government or a local authority. A VAT invoice must contain the date that the invoice was issued, an invoice number, a description of the goods or services supplied, the total price of the goods and services supplied excluding VAT, and the amount of VAT applied to the sale.