Budget Changes 2012
The Standard rate of VAT will increase from
21% to 23% with effect from 1 January 2012.
All goods and services currently subject to
the rate of 21% will be affected (Drink & Cigarettes, Transport
fuels, Vehicles, Consumer Goods, Hiring/Leasing, Confectionery and
Services like accountancy, advertising, haulage,
telecommunications, toll roads etc.
This increase doesn’t affect to the zero rate,
the 13.5% reduced rate or the 9% approved in June.
The credit notes issued after January must
show the VAT at the rate of the original invoice was issued
(invoices in 2011, 21%).
Contracts with fixed interval payments, like
rental of an office from June 2011 to June 2012, the invoices
issued on 2012 will be taxable at 23%.
Contracts existing on 1 of January 2012 and
not completed until after that date will need to be adjusted unless
there is agreement to the contrary between the parties.
Businesses on the cash basis of accounting for
VAT (VAT cash accounting) that make supplies before 1st January
2012 but receive payments on or after 1st of January will apply 21%
to those supplies. Only supplies made after the 1st of January
will be at the 23% rate.
The rate change will also apply to
the import of goods where the VAT rate will 23% on the date of
import. Intra-EU acquisitions of goods and reverse charge services
received will also be affected.
For Information on implementing these changes in your
Sage 50 Accounts and Sage Instant
Accounts can view our Knowledge Base Article
here. If you have a support contract you can login here to download the VAT Rate Change Utility and
Reports.
For more details on these rules see http://www.revenue.ie/en/tax/vat/leaflets/increase-in-standard-rate.html.
If you would like more informationon a Sage Support
Contract call us 1890 88 25 22.