VAT ON ELECTRONICALLY SUPPLIED SERVICES ROS

Introduction

A Special scheme for VAT on electronically supplied services came into effect on 1 July 2003. Under this scheme electronically supplied services supplied to private consumers in the EU by businesses that have no physical presence in the EU, are now liable to VAT in the Member State of the consumer. The rate applicable is the standard rate of VAT in that member state.

An “electronically supplied service” is one that is delivered over the Internet (or an electronic network which is reliant on the Internet or similar network for its provision) and is heavily dependent on information technology for its supply - i.e. the service is essentially automated, involving minimal human intervention and in the absence of information technology does not have viability. An indicative list of such services is given in Annex L of the 6th EU VAT Directive.

This special scheme enables the non-EU supplier to choose one EU country in which to register and pay VAT, regardless of the Member State in which the supplier’s private consumer resides. Once registered the supplier must make returns, declaring the VAT due on all the on-line sales to consumers within the EU. A special return form will be provided under which the supplier must provide a breakdown of all electronic supplies to customers in each Member State.

What businesses are eligible to use the special scheme?

A business is eligible to use the special scheme if it:

• Supplies electronically supplied services to private consumers who reside in the EU
• Is not established within the EU, and
• Is not otherwise registered (or required to be registered) for VAT in any Member State.

Register for this scheme using ROS

Revenue are setting up a register of non-EU suppliers who opt to register in this country under the scheme. The registration process is only available electronically through the Revenue On-Line Service (ROS). The ROS home page has been specifically re-designed to cater for this potential new customer base and now includes a new section for Non EU customers. A new registration and digital certificate retrieval process has been designed and implemented, in addition to the new special VAT return.

Registration

ROS offers the applicant a dual function at the registration stage:

• They receive their VAT identification number (the special VAT number for electronic services supplies) under the special scheme, and
• They receive their system password enabling them retrieve their digital certificate and gain access to ROS.

On registration, businesses are asked to supply the following details:

• Name and postal address
• Electronic addresses including website addresses
• National tax number, if any
• A statement that the supplier is not registered for VAT within the EU, and
• The date from which the supply of electronically supplied services to EU consumers commences.

In addition to the above, due to the high levels of security attached to the digital certificate process, non-EU businesses are also requested, during the registration process, to input an access code. This code will act as a shared piece of information between the business and the Irish Revenue and will never be displayed on any screen or any correspondence issued from Revenue to the business. The sole purpose of this code is to identify the business at digital certificate retrieval stage.

Further Information

ROS provides its existing customer base with both email and telephone helpdesk facilities. For this VAT scheme these facilities are also available to any business that elects to register in Ireland under this scheme. Contact details are:

Email: roshelp@revenue.ie

ROS helpdesk: 00 353 1 277 1178

In addition to the ROS helpdesk, Revenue are also providing an additional email help facility in relation to any enquiries of a technical VAT nature at euvat@revenue.ie.

There is also a VAT Information Leaflet No. 2/03, Electronically Supplied Services and Radio & Television Broadcasting Services which is available on the Revenue website, www.revenue.ie under publications/leaflets & guides/VAT.