The Revenue Commissioners have written to almost 6,000 principals and sub-contractors to notify them of the need to review their VAT Direct Debit payment arrangements in the wake of the new VAT reverse charge rule applicable from 1 September 2008 to principals and subcontractors operating in the construction industry.

The ICAI has been informed that Revenue have requested notified principals and principal/subcontractors to sign and return a statement within 14 days confirming that they understand that their direct debit arrangements should be reviewed and provide details of the revised amounts. If principals and principal/subcontractors fail to return the statement, then Revenue will review whether or not the direct debit facility can continue to be made available to the non-respondents. Full details on the new reverse charge rule are available on Revenue's website.

The Revenue have also identified cases with the top 5,000 highest profiled VAT liabilities, the top 5,000 highest profiled additional VAT liabilities and the top 5,000 highest profiled VAT claims, using the 2007 financial data of customers. This information has been disseminated to the various districts for the purposes of monitoring and assisting affected taxpayers to ensure the correct implementation of the reverse charge treatment.