VAT Reliefs for Diplomats

Introduction

The Minister for Finance has signed “The Value Added Tax (Refund of Tax) (No. 29) Order, 1996”. The Order was signed into law on 12 November 1996 and has effect from 1 December 1996. The order deals with relief from VAT for certain goods and services purchased by accredited diplomatic personnel serving in Ireland.

The order provides a statutory basis for repayment of VAT by Revenue to diplomats on the goods listed below where the amount of VAT involved is £100 or more. Claims should be submitted to the Office of the Accountant General on form “Dip 1.”, as before. The new order also provides for remission of VAT by traders where a single item costs at least £250 (including VAT).

New Procedures

Remission of VAT as provided for in the new order will be dealt with by way of prior authorisation.

A form “Dip 1A” must first be approved by the Head of the Diplomatic Mission and submitted to the Department of Foreign Affairs. The Department will then authorise the form and forward it to be stamped by the Accountant General and returned to the Diplomatic Mission.

The diplomatic will then produce the authorisation on form “Dip 1A” to the trader who will then be able to “Zero-rate” the supply. The trader will retain the original in his VAT records to vouch the validity of the “zero-rated” supply. The authorisation will be valid for a period of three months from the date of issue by the Accountant General. A separate authorisation and form “Dip 1A” is required for each purchase.

Qualifying Goods and Services

Another new feature introduced by the order is that supplies of gas, electricity and telecommunications services to the Ambassador’s/Head of Mission’s residence and the official embassy premises can also be effectively “zero-rated” on the basis of a single once-off authorisation for each premises.

Other goods and services which qualify for remission or repayment are:

• Purchase or lease of the official premises of the embassy or diplomatic mission and the principal residence of each member of the diplomatic staff
• Household goods for use in the above premises
• Business goods necessary for the performance of duties
• VRT-free motor vehicles
• Bicycles
• Excisable products
• Certain hire, maintenance, transport and storage services.

Copies of the Order (S.I. No. 334/96) are available from:

Government Publications Sales Office,
Sun Alliance House,
Molesworth Street,
Dublin 2.

Tel.: (01) 661 3111

Fax: (01) 475 2760

Price per copy £2.00

Further Information

Any queries regarding the new scheme should be addressed to your local tax office or to:

Office of the Accountant General,
Government Offices,
Kilrush Road,
Ennis,
Co. Clare.

Tel.: (065) 41200

Dublin Callers: (01) 677 4211

Fax: (065) 40394