Self-invoicing

johnsmith6256

Hi,

I cannot find a lot of information about Self-invoicing apart from revenue.ie/en/tax/vat/guide/credit-notes.html#section12 and en.wikipedia.org/wiki/Invoice#Variations

I have a limited company in Ireland and I would like to know if it's OK to use self-invoicing for the services of a consultant based abroad (India in my case).

Paddy001

Your post is a little confusing. Can you give more information regarding what you want to do?

GerardKeating

johnsmith6256 wrote: »

Hi,

I cannot find a lot of information about Self-invoicing apart from revenue.ie/en/tax/vat/guide/credit-notes.html#section12 and en.wikipedia.org/wiki/Invoice#Variations

I have a limited company in Ireland and I would like to know if it's OK to use self-invoicing for the services of a consultant based abroad (India in my case).

I gather you have a Limited Company in Ireland, which is engaging the services of a consultant based in India, and for some reason, this consultant cannot give you an invoice, so you want to "create" the invoice on their behalf?

johnsmith6256

GerardKeating wrote: »

I gather you have a Limited Company in Ireland, which is engaging the services of a consultant based in India, and for some reason, this consultant cannot give you an invoice, so you want to "create" the invoice on their behalf?

Yes, this is exactly my question. Thanks for reformulating.

dudara

I've never actually thought about this scenario, but I'd imagine it would be a red flag to Revenue as it could look like money laundering or worse.

It is possible to do self-invoicing on the foot of Evaluated Receipt Settlements etc, but that all depends on having an agreement in place with your supplier, and it's usually done following receipt of goods/services on a purchase order. In other words, there's a pre-existing trail to justify the self-invoicing.

I'd recommend ringing someone for advice on this. I personally wouldn't do it.

power101

Personally I think this would be setting off a lot of red flags with revenue. I've never heard of this. In this day and age anyone should surely be able to create and send an invoice. There are so many websites online that can do this. Even a basic invoice using Ms Word would do. Revenue though do have a specific section on this which you may find useful .

http://www.revenue.ie/en/tax/vat/guide/credit-notes.html#section12

12. Self-billing and outsourcing arrangements

A VAT registered customer who receives a supply of goods or services may issue the required VAT invoice provided;

• There is prior agreement with the supplier that the customer may draw up and issue the invoice,
• All conditions relating to the content or issue of the invoice are met by the customer,
• Agreed procedures are in place for acceptance by the supplier of the validity of the invoice,
• The invoice is endorsed with "self-billing".

An invoice issued under these arrangements is regarded as having been issued when the supplier accepts it in accordance with the procedures in place.
The issuing of invoices, settlement vouchers, credit notes and debit notes, may be outsourced by an accountable person provided such documents are issued by a person who acts in the name and on behalf of the supplier and all conditions imposed by VAT law in relation to the form, content and issue of such documents are met.

johnsmith6256

Thanks. That's the link I posted in my first message.

Would that mean it's only allowed for VAT invoices? (Intra-EU)

power101

johnsmith6256 wrote: »

Thanks. That's the link I posted in my first message.

Would that mean it's only allowed for VAT invoices? (Intra-EU)

By the way it's phrased both companies would have to be registered for VAT. It doesn't mention the EU but this is something you should get specific professional advise about.

dbran

Hi

If you are accepting a service from a source based outside the state then you are obliged to register and account for the Irish VAT that would have been applicable had the service been provided from an Irish VAT registered entity using the reverse charge mechanism.

That is to say, you charge yourself the VAT and at the same time, you claim a deduction or VAT credit of the same amount so the amount that is due to revenue is zero.

If you do not follow this rule then revenue may on fact raise an assessment for the VAT due but will not allow the VAT credit. A nice tidy sum plus interest and penelties.

Hope this helps.

dbran

johnsmith6256

Hi dbran,

Thank you for your answer.

Do you mean I need to write something about this on the self-billing invoice? Or do I just need to make this on the VAT3 form?

dbran

You need to deal with it on the VAT 3 form.

johnsmith6256

dbran wrote: »

You need to deal with it on the VAT 3 form.

Hi dbran,

Are you sure that's applicable for services from Outside the european union?

This page: revenue.ie/en/tax/vat/guide/accounting.html#section5 says "This figure should also include VAT on all Intra Community Acquisitions of goods and services."

dbran

Hi John Smith

It applies both inside and outside of the EU. And remember there is no threshold applicable.


http://www.revenue.ie/en/tax/vat/guide/supply-of-services.html#section6

6.1 Requirement to Register

A business in the State, which receives a taxable service from outside the State (both intra-Community or from outside the Community) will be required to register and account for Irish VAT.


Dbran

johnsmith6256

Thank you!

I can't believe information is so disparate and confusing.