Vat Registration as a Sole trader - is VAT charged on all income or just income >€37.5k?

thewiseowl12

Grateful for any experience of my question - I will consult professionals as appropriate but just trying to get a rough idea at present for an upcoming quote I'm putting together.

I currently offer consultancy services in my specialty and in any year to date I have not charged VAT - I believe the threshold is 37,500 for VAT registration and I have never come near that amount. As such my quotes have not included VAT.

I am currently quoting a company for work next year where I may exceed €37,500 of advisory services potentially, and I want to ensure that any VAT implications are included in my quote.

If I do exceed the amount I'm presuming I must register for VAT, but is VAT then charged on all income or just income post 37,500? I'm afraid that part isn't quite clear to me.

Finally - I've noticed that they state a 12 month rolling window for VAT registration?

Say if I was paid 20k for consultancy in Nov 2022, comprising the whole year for 2022, and then has received 20k by September 2023, comprising the whole year 2023 - then under this rolling window of 12 months I would have exceeded the VAT Threshold even though it would be less than 37.5k for each year individually. Would I then have to charge VAT?

Sorry for the flood of questions, and grateful again for any rough guidance on the above.

Thanks.

Citrus_8

https://www.boards.ie/discussion/2058268085/vat-registration-as-a-sole-trader-is-vat-charged-on-all-income-or-just-income-37-5k

https://www.revenue.ie/en/vat/vat-registration/who-should-register-for-vat/what-are-the-vat-thresholds.aspx

ari101

You charge VAT on all sales not just those over 37.5k when registered.

If you expect to exceed the threshold in 12 months from now you would be expected to register now, regardless of it crossing over two financial years.

If you are dealing with an Irish VAT registered business, quoting for the job stating the fee quoted is exclusive of VAT might be one way to cover this off.

You should also review your existing clientele to determine who might be impacted by registering (e.g. consumers and non VAT reg entities who can't claim the VAT back), these contracts might take a hit /require renegotiation.