Sales Tax on selling a product to a US Company?

[TTI]

Hi,

Can anyone advise me whether VAT, etc. is chargeable on an order to a US company from a Irish Ltd company?

 

[dublin66]

In a word yes but at zero per cent. Sales (called supplies in the vat world) outside of the European Union are zero rated. Ensure that you retain proof of dispatch of goods to the US to prove the zero rate.

Difference between exempt and zero is that you can reclaim vat on costs related to zero rated supplies where exempt you can't. In the latter case VAT is a cost

 

[TTI]

Many thanks, that gave me enough to search further:

8.1 What are exports?
For VAT purposes,exports are goods directly dispatched to a destination outside the EU. In this context, it should be noted that, for VAT purposes, certain territories (for example, the Canary Islands and the Channel Islands) are regarded as outside the EU. The zero rate of VAT applies to all supplies of goods which are transported directly by or on behalf of the supplier to a place outside the EU. The supply of goods subject to a condition that they are to be dispatched or transported directly outside the EU by or on behalf of the purchaser of the goods, where that purchaser is established outside the State also qualifies for the zero rate. A number of other export type transactions and related services are also zero-rated, as are supplies of goods to VAT-registered traders in the Shannon Customs-free airport and Ringaskiddy free port. Please refer to paragraph (i) of Appendix B.

 

[mandelbrot]

OP, is this relevant to you?
http://www.revenue.ie/en/tax/vat/leaflets/eservices-and-broadcasting.html#section1
http://www.revenue.ie/en/tax/vat/leaflets/eservices-and-broadcasting.html#appendix

 

[TTI]

OP, is this relevant to you?
http://www.revenue.ie/en/tax/vat/leaflets/eservices-and-broadcasting.html#section1

Thank you kindly for your response, and very interesting to be aware of but I read this at the top of the page:

In general the normal Place of Supply of services rules apply to electronically supplied services (eServices). However an optional scheme known as the Electronic Services Scheme, provided for in Section 91 VAT Consolidation Act 2010, applies where the supplier is established outside the EU and the customers involved are non- taxable persons e.g. private individuals established in the EU. Under the terms of the scheme ( see Paragraph 3.1) suppliers can opt to register for VAT in one Member State of the EU and account for VAT due there on all their supplies of eServices made within the EU.

So in this case it wouldn't apply to me as I am setting up a Ltd company in Ireland.

 

[mandelbrot]

Thank you kindly for your response, and very interesting to be aware of but I read this at the top of the page:



So in this case it wouldn't apply to me as I am setting up a Ltd company in Ireland.

I didn't mean the special scheme; I meant that you may not in fact be providing "goods" for VAT purposes, but rather "services", and there may be differences in how VAT is to be accounted for.

It's just something you need to be aware of, what the technical definition of what you're selling is, and how you need to account for it.