Do i pay VAT3 if my payment is delayed significantly?

[MeathCommute]

Hi. I am an IT contractor who invoices near the end of each month and is paid on the first Friday of the following month. Due to some complex issues, I haven't been paid in the last 2 months. I normally pay VAT3 on 1st July. Will I do a zero return if I don't get paid by then?

 

[T McGibney]

Are you on the cash receipts basis or the invoice basis for VAT?
If the former, you account for the sale when you get paid.
If the latter you account for the sale when you raise the invoice. (You shouldn't really be in this category if your turnover is less than €1m p.a.)

 

[MeathCommute]

Thanks..I am the former. Do Revenue know when I get paid? Do you think my agency would send that data to the Revenue? I remember a few years ago, I accidentally sent a VAT payment to Revenue but forgot to complete the VAT3..they fined me a surcharge. Would that have been because they knew what they should have been getting?

 

[T McGibney]

Thanks..I am the former. Do Revenue know when I get paid? Do you think my agency would send that data to the Revenue? I remember a few years ago, I accidentally sent a VAT payment to Revenue but forgot to complete the VAT3..they fined me a surcharge. Would that have been because they knew what they should have been getting?

Sorry but you really need to hire an accountant if you don't know the answers to these basic questions.

No, Revenue won't know when you are paid but will care less but false accounting for VAT is a serious offence and if your returns are ever inspected and found to be based on lies, they way well take a dim view of it all.

 

[MeathCommute]

I do have an accountant. I'll ask him thanks.

 

[MeathCommute]

Is it false accounting to pre-pay VAT e.g. I'm getting paid on 5th July, but I send a VAT return in on 1st July including the figure?

 

[jpd]

Why would you do that?

You are effectively loaning money to the Revenue by paying before it is due

 

[Ciru75]

Is it false accounting to pre-pay VAT e.g. I'm getting paid on 5th July, but I send a VAT return in on 1st July including the figure?

The question doesn't really make sense. You return VAT every two months. If you get paid on the 5th of July, the VAT on it would be in your VAT return for July/August. You couldn't file that return until after the end of August.