VAT Reverse Charge - Gas, Electricity, Gas and Electricity Certificates

The Finance Act 2015 introduces a VAT reverse charge mechanism for accounting for VAT on:

• wholesale supplies of gas or electricity, and
• supplies of gas or electricity certificates

Under the reverse charge mechanism, the recipient, rather than the supplier, is accountable for the VAT on the supply.

The new rules come into effect from 1 January 2016. This means that supplies which take place on or after this date will be impacted by this change.

A new VAT Manual (Part 03-28) relating to the reverse charge on wholesale supplies of gas and electricity, and supplies of gas and electricity certificates has been published on the Revenue website. The Manual references a leaflet which contains guidance on:

• Who is impacted by the new rules
• The scope of the rules
• How the reverse charge system works
• Invoicing
• Deductibility
• The rules in relation to persons not registered for VAT
• Transactions taking place through the Single Electricity Market

23 December 2015