Vat on an unpaid purchase invoice

PatrickJ

Registered User
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170
Can a refund be requested on an unpaid purchase invoice?
The company accounting system is based on cash accounting.
 
If you mean can you reclaim VAT on an unpaid purchase invoice, then yes you can.

The cash accounting rules only apply to sales invoices, VAT is still claimed on purchases on an invoice basis

However if you have any purchases invoices which remain unpaid 6 months after the end of taxable period in which the VAT was reclaimed then you must repay the claimed VAT back to Revenue

"To be entitled to the deduction the trader must have a proper VAT invoice or relevant Customs receipt as appropriate. With effect from the 1st January 2014 where a person deducts VAT in a taxable period but has not, within 6 months of the end of that taxable period, paid the supplier for the goods or services, then the amount of VAT deductible will be reduced by the amount of VAT relating to the unpaid consideration i.e. the VAT deducted relating to the unpaid consideration must be repaid to Revenue. A re-adjustment is provided for in the event of subsequent payment or part payment for the goods or services."

http://www.revenue.ie/en/tax/vat/guide/vat-deductible.html#section4
 
Thanks for clarifying DB74.

The company I work for has a revenue inspection shortly. To cut a long story short we were called into a meeting by higher management and informed of the inspection. Office gossip has it that revenue are seeking payment on large purchase invoices that are past the six month due date and were not paid by my employer but yet they claimed the vat on them. The company does not have the means to pay their supplier at present as the project we are working on is still on going and the supplier is making adjustments to work they provided us with. In lieu the supplier is going to issue us with new terms and conditions of payment.

My only concern is that I have job when all this is over!
 
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