KerrySurfer
Registered User
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Quick question about VAT for any self employed people or accountants out there. Basically is there a facility for invoicing in Ireland where you make purchases on behalf of your customer and therefore do not have to charge VAT, just bill them the price paid for said purchases.
e.g. IT consultant contracted to set up an office network for a client and is instructed to purchase all equipment on their behalf. Obviously the equipment would have been bought inclusive of VAT. Consultant only wants to charge VAT on his services and not on the goods. In the UK it's dealt with as follows;
"Disbursements: costs to exclude from VAT calculations
A payment made to suppliers on behalf of your customers is called a ‘disbursement’ if you pass the cost on to your customers when you invoice them.
You might be able to leave out these payments from your VAT calculations because it’s the customer, not you, who buys and receives the goods or services; you’re just acting as their agent.
To treat a payment as a disbursement all of the following must apply:
Just wondering if we have something similar in Ireland. Will obviously be chatting to an accountant at some stage but someone here may have a quick reply for me. Cheers!
e.g. IT consultant contracted to set up an office network for a client and is instructed to purchase all equipment on their behalf. Obviously the equipment would have been bought inclusive of VAT. Consultant only wants to charge VAT on his services and not on the goods. In the UK it's dealt with as follows;
"Disbursements: costs to exclude from VAT calculations
A payment made to suppliers on behalf of your customers is called a ‘disbursement’ if you pass the cost on to your customers when you invoice them.
You might be able to leave out these payments from your VAT calculations because it’s the customer, not you, who buys and receives the goods or services; you’re just acting as their agent.
To treat a payment as a disbursement all of the following must apply:
- you paid the supplier on your customer’s behalf and acted as the agent of your customer
- your customer received, used or had the benefit of the goods or services you paid for on their behalf
- it was your customer’s responsibility to pay for the goods or services, not yours
- you had permission from your customer to make the payment
- your customer knew that the goods or services were from another supplier, not from you
- you show the costs separately on your invoice
- you pass on the exact amount of each cost to your customer when you invoice them
- the goods and services you paid for are in addition to the cost of your own services
Just wondering if we have something similar in Ireland. Will obviously be chatting to an accountant at some stage but someone here may have a quick reply for me. Cheers!