Vol. 468 No. 4
100 Mr. N. Ahern asked the Minister for Finance the current position in relation to VAT payments paid by a builder's hardware supplier who has paid considerable VAT to the Revenue Commissioners in respect of sales to a few clients who have gone bankrupt without paying their due accounts; whether a more simple way can be devised to allow the VAT to be reclaimed without incurring huge legal expenses; and if he will make a statement on the matter. [15590/96]
In general, a supplier who has accounted for VAT to the Revenue Commissioners in respect of such supplies to customers who subsequently default to making payment for such supplies is entitled to reclaim the VAT element of such bad debts. This is covered by Section 10 (3) of the VAT Act 1972 and Regulation 8 of the 1979 VAT Regulations.
Once the specified amounts are formally written off in the suppliers books the VAT adjustment on such bad debts can be made as soon as the VAT return for the next VAT period is made.
In view of the position outlined above, it is considered that an amendment to the legislation is not necessary. However, if the Deputy has has a specific case in mind, the Revenue Commissioners have informed me that they will be pleased to consider the matter on receipt of the relevant details.
