Vat exemption

roadrunner1

we have a supplier who is also a customer - they received their vat exempt staus since beginning of Jan.
They want us to charge them excluding vat for goods we supply them.
But they are invoicing us incl vat for goods we buy from them - is this correct?
We are not vat exempt ourselves.

Mr. Incognito

What do you mean they received their VAT exempt status? You mean they are VAT registered? This means they are entitled to claim a VAT credit in thier VAT returns against VAT paid. They are not "exempt" from paying VAT. Charge them VAT.

Bren1609

It's incorrect.

You charge VAT as usual and they should NOT be charging VAT. VAT exempt means that they have to suffer VAT and cannot reclaim the input credits. I assume that your company is not VAT exempt, if that is the case then you still have to charge VAT.

Unless they can produce a letter from revenue stating that they are not to be charged VAT then you must charge VAT. Even if they can produce that letter it means that they are not a VAT exempt entity because revenue generally only issue those letters to import/export comapnies which are not VAT exempt.

You charge VAT and they don't charge VAT.

Mr. Incognito

<snip>

kluivert

gordotempo wrote: »

I'd put my house on it that Setanta L is defo big 4. Doesn't know what Vat exempt is!!!

Just tick the box and move on, all in a days work...:D

This has no input on the OP's original question and therefore no relevance to the thread.

Pleae review your input and amend accordingly.

kluivert

SetantaL wrote: »

Chip.........Shoulder

See above ^

kluivert

Exemptions
15.6 The goods and services which are exempted from VAT are listed in Appendix A. Exempted goods and services consist principally of financial, medical and educational activities as well as admissions to and promotion of certain live theatrical and musical performances. Exemption from VAT means that the persons engaged in the exempt activity are not liable for VAT on their receipts and are not entitled to a credit or deduction for VAT borne on their purchases. It is emphasised that exempt bodies are not entitled to receive taxable goods or services free of VAT simply because they are exempt from charging VAT on their supplies.

The position of a business with both exempt and taxable activities is explained in paragraph 6.10 of Chapter 6.

http://www.revenue.ie/index.htm?/leaflets/vatguide_chapt15.htm

English translation - They dont charge you Vat, but you charge them Vat.

PhoenixGal

Hi

If they want you to charge them excluding VAT, they must supply you with a form VAT 13B, and you need to quote the authorisation number on this on all invoices.

Check this out... http://www.revenue.ie/services/foi/s16_2001/chap_13a.pdf