When do you have to start paying VAT ?
It depends on your turnover
Turnover is based on a 12-month rolling period, which means you should always review your turnover at the end of each month to ensure it hasn’t exceeded the VAT threshold in the previous 12 months.
But note you can still choose to register for VAT even if your turnover is unlikely to reach the threshold limit.
The main VAT thresholds from 1st January 2025:
- €42,500 if your business supplies services only
- €85,000 if your business supplies goods only
- If your business supplies both goods and services and if 90% or more of your turnover is from the supply of goods, the €85,000 threshold applies if not than €42,500 applies
Another threshold that may apply to your business is (note, this is based on a calendar year rather than a rolling 12-month basis):
- Businesses receiving goods from another EU Member State worth more than €41,000.
In some instances, your turnover amount may be reduced by the amount of VAT already paid on stock that was purchased for resale. In this case, the reduced turnover figure may be used to determine if your turnover exceeds the threshold.
Any queries on same give me a call on 091 763817 or email me at oliver@taxreturnhelp.ie