Revenue Note for Guidance

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Revenue Note for Guidance

91. Electronic services scheme


This section reflects the provisions of Articles 359 to 369 of the VAT Directive, which provide for an optional special scheme for the VAT treatment of electronic services supplied by non-EU business to private consumers in the EU, where such businesses are not established in the EU. The special scheme was introduced to reduce the compliance burden and administrative costs for suppliers. The 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 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 is provided under which the supplier must provide a breakdown of all electronic supplies to customers in each Member State. Payment is made to a designated account in the Member State of registration. That Member State must re-distribute these VAT receipts to Member States in accordance with the amounts due as declared by the supplier. The rate of VAT is the standard rate in the country where the consumer resides and quarterly returns are provided for.

Note that the place of supply of electronic services which are supplied by a non-EU supplier to a private consumer in the EU is the place where the private consumer normally resides. Where a non-EU business supplier does not opt to use the special scheme, it is obliged to register and account for VAT in every EU Member States where it has private customers.

Note that this section does not apply to supplies of electronic services made on or after 1 January 2015. From that date the provisions of Chapter 2 (special schemes for telecommunications services, broadcasting services and electronically supplied services) can be applied by suppliers of such services.


(1) Subsection (1) is a definitions section.

(2) Subsection (2) is the enabling provision, which allows traders to use the scheme.

(3) Revenue is allowed to set up an identification register of non-EU suppliers who opt to register in this country under the scheme. Registration is accessible only through the ROS system.

(4) The information that must be furnished to Revenue by the non-EU suppliers in order to get on the register is set out in subsection (4). This is done electronically.

(5) Revenue registers the applicants and provides them with an identification number on receipt of the information.

(6) The suppliers on the Irish register must submit special VAT returns and pay Revenue the VAT due in respect of their supplies in all Member States, including Ireland, within 20 days of the end of each calendar quarter. Payment must be made in euro to a bank account designated by the Accountant General’s Office. A nil return must be submitted where the person does not make any supplies in the quarter.

(7) Subsection (7) itemises the details that must be included on the special VAT return.

(8) In the case of these electronic supplies the conversion rate will be the rate as published by the European Central Bank for the last date of the calendar quarter, or if there is no publication on that date, the rate on the next day of publication – note that this is different to the normal conversion rules in section 37(4).

(9) A person from outside the EU who makes supplies in Ireland under the scheme is not entitled to deduct input VAT using the VAT return, but is entitled to claim a refund from Revenue under the 13th VAT Directive.

(10) A supplier can discharge his or her tax liabilities in relation to registration, record keeping and payments by paying Irish VAT in another Member State under this scheme. This ensures that a double set of VAT obligations on the supplier is not created.

(11) The normal compliance rules, the interest provisions and other common provisions of the VAT Act apply to suppliers into Ireland under the special scheme.

(12) Subsection (12) covers obligations in relation to record keeping under the scheme. It obliges a person who becomes taxable under the special scheme to keep full and true records for a period of 10 years. It also provides that all such records must be made available on request to Revenue and other Member States of consumption.

Subsections (13) and (14) provide for rules governing the operation of the register.

(13) Suppliers are obliged to tell Revenue if their circumstances change, etc.

(14) Revenue can exclude a supplier from the register if the person does not comply with the rules, ceases to supply the e-services, etc.

(15) Subsection (15) allows Revenue to make regulations if necessary, to give effect to the scheme.

(16) Subsection (16) disapplies the electronic services scheme under this section in relation to supplies made on or after 1 January 2015 when the special schemes for telecommunications services, broadcasting services and electronically supplied services in Chapter 2 take effect.

Relevant Date: Finance Act 2020