VAT CLAWBACK OF UNPAID INVOICES

Budget 2014 inserted a new section No. 62A into the Vat Consolidation Act 2010.

This came into effect from 1st January 2014.

An accountable person must repay the Input Vat they claimed if the relevant good/service has not been paid by them within three taxable periods (six months) following the end of the period in which the claim was made. The Vat deductible in the third taxable period is reduced by the amount of Vat related to the unpaid consideration.

Where there are reasonable grounds for not having paid the full consideration, an adjustment will not be required  provided this has been agreed with the Revenue beforehand.