The European Commission recently published a study on VAT refund systems across the EU. While Ireland is among 20 member states compliant with the EU’s conditions and processes for cross border refund claims, the report notes that taxpayers reported issues when seeking VAT reimbursements relating to activities in Ireland. These issues include concerns on the conditions taxpayers are required to meet before a claim will be repaid, and the length of time taken for a taxpayer to receive a reimbursement.

The study distinguished between VAT refunds and VAT reimbursements. VAT refunds are defined as a repayment of VAT paid in member states other than the location in which a taxpayer is established while VAT reimbursements are defined as a repayment of domestic input VAT paid in excess of output VAT due. While Ireland is compliant with Directive 2008/9/EC in terms of cross boarder VAT refunds, the report notes delays for domestic VAT reimbursements for the following reasons:

• There is no time limit within domestic legislation for a reimbursement to be paid, which can cause issues for taxpayers.
• There are frequent delays due to the Irish tax authority requesting further documentation to support claims.