Revenue Note for Guidance

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Revenue Note for Guidance

27. Self-supply of services

Summary

This section makes provision for the charging of “self-supplies of services” in accordance with regulations. There are regulations covering the private use of business assets and for catering services. The section also provides that the private or non-business use of property is a self-supply of services, if VAT deductibility had been claimed in respect of its development or purchase.

Details

(1) Subsection (1) makes provision for the charging of “self-supplies of services” in accordance with regulations. The Regulations made to date concern the use of business assets for private or non-business purposes and canteens (Regulations 7 and 8 of the VAT Regulations 2010).

Other self-supplies of services are not taxable, but the VAT must be accounted for on the goods used. For example, if a painter paints his own house using paint taken from stock, he or she is liable to account for VAT on the paint but not on the value of labour supplied.

(2) Subsection (2) provides, subject to subsection (3), that with effect from 1 July 2008 if VAT deductibility is claimed by a business on the acquisition or development of property, then the private or non-business use of that property during the next 20 years is a taxable supply of services. The taxable amount is based on the amount of VAT charged to the accountable person at the time of the purchase.

(3) Subsection (3) excludes immovable goods acquired or developed on or after 1 January 2011 from the provision in subsection (2).

Example:

  • Cost of property: €1million, made up of €881,058 plus €118,942 VAT @ 13.5%
  • Property used 80% for business and 20% for residential purposes
  • VAT deductibility of €118,942 claimed (i.e. full amount).
  • Amount on which VAT is chargeable for each taxable period is: €881,058 × 20% = €176,211 (private proportion) × 1/20 = €8,810 (annual amount) × 1/6 =€1,468 (per taxable period).
  • VAT payable in respect of the self-supply for each taxable period is €1,468 × 21% = €308.

Relevant Date: Finance Act 2019