VAT3 question

JohnK

Just wondering if when filling the vat3 form, should the incoming vat amounts be what you've actually recieved in for that period or for amounts you've invoiced for that period?

Why I'm asking is since it can now take a few months before invoices are paid its putting me quite a bit out of pocket to be paying vat on an invoice that wont be paid to me for about another 4 months.

thanks.

AndyJB

JohnK wrote: »

Just wondering if when filling the vat3 form, should the incoming vat amounts be what you've actually recieved in for that period or for amounts you've invoiced for that period?

Why I'm asking is since it can now take a few months before invoices are paid its putting me quite a bit out of pocket to be paying vat on an invoice that wont be paid to me for about another 4 months.

thanks.

Hi,
Certainly can make a lot of difference to the cash flow. Make sure you're registered under the "Cash Receipts" basis with the VAT man. There maybe turnover thresholds involved, so give your local VAT office a bell.

Andy

JohnK

Thanks Andy. I did a search on the revenue site for Cash Reciepts but it seems that only works if you primarily deal with people who arent registered for VAT so I'm out of luck there

nompere

From http://www.revenue.ie/en/tax/vat/charging/index.html

A trader must fulfill one of two criteria to be on the Cash Basis. Either

Annual turnover does not exceed one million €; or
Supplies are almost exclusively (at least 90%) made to customers who are not registered for VAT, or are not entitled to claim a full deduction of VAT.

If your turnover is less than €1 million you are entitled to use the cash receipts basis, no matter who you sell to.

You have to ask Revenue, but it's pretty automatic.

AndyJB

JohnK wrote: »

Thanks Andy. I did a search on the revenue site for Cash Reciepts but it seems that only works if you primarily deal with people who arent registered for VAT so I'm out of luck there

Hi,
I'm reg'ed "Cash Receipts". Best thing to do is give them a bell.

Andy

goz83

Me too. Call them and change it, because if you're registered on an invoice basis, you might never be paid for that invoice and will still technically have to pay VAT on the invoice. Cash Receipts is the way to go.

JohnK

Ah sweet, I missed that "OR" and I'm nowhere near the €1,000,000 turnover so I'll give them a ring and see what they can do for me

Thanks!