Answer ... Value added tax (VAT) is a transaction tax based on EU directives as implemented into Irish law. It is chargeable on the supply of goods and services in Ireland and on goods imported into Ireland from outside the European Union. Persons in business in Ireland generally charge VAT on their supplies, depending on the nature of the supply. The standard VAT rate is 23%, but lower rates apply to certain supplies of goods and services, such as:
- 13.5% – for example, on supplies of land and property; and
- 0% – for example, on certain food and drink, books and children’s clothing.
The supply of certain services, including financial services, is exempt from VAT.
VAT incurred will generally be recoverable as long as it is incurred by a taxable person (ie, a person that is, or is required to be, VAT registered) for the purpose of making taxable supplies of goods and services. VAT incurred by a person that makes exempt supplies is not recoverable.
Customs duties are payable on goods imported from outside the European Union.
Excise duty applies at varying rates to mineral oils, alcohol and alcoholic beverages, tobacco products and electricity, and will also apply to certain premises and activities (eg, betting and licences for retailing of liquor).
There is an insurance levy on the gross amount received by an insurer in respect of certain insurance premiums. The rate is 3% for non-life insurance and 1% for life insurance. There are exceptions for reinsurance, voluntary health insurance, marine, aviation and transit insurance, export credit insurance and certain dental insurance contracts.
Answer ... Generally, a document is chargeable to stamp duty, unless exempt, where the document both:
- is listed in Schedule 1 to the Irish Stamp Duties Consolidation Act 1999 (the principal head of charge is a transfer of any Irish property); and
- is executed in Ireland or, if executed outside Ireland, relates to property situated in Ireland or to any matter or thing done or to be done in Ireland.
The transferee is liable to pay stamp duty and a return must be filed and stamp duty paid within 44 days of execution of the instrument.
Stamp duty is charged on the higher of the consideration paid for, or the market value of, the relevant asset at the following rates:
- shares or marketable securities – 1% (in some cases, a rate of 6% applies to shares that derive their value from Irish land);
- non-residential property – 6%; and
- residential property – 1% on consideration up to €1 million and 2% on the excess.
There are numerous reliefs and exemptions, including:
- group relief on transfers between companies where the transferor and transferee are 90% associates at the time of execution and for two years thereafter;
- reconstruction relief on a share-for-share exchange or share-for-undertaking transaction, subject to meeting certain conditions; and
- exemptions for transfers of intellectual property, of non-Irish shares and land, loan capital, aircraft and ships.