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Personal Insolvency Practitioners

Dáil Éireann Debate, Tuesday - 18 June 2013

Tuesday, 18 June 2013

Questions (81)

Willie Penrose

Question:

81. Deputy Willie Penrose asked the Minister for Finance the steps he will take to remove the application of VAT to the rates charged by insolvency practitioners who are employed to deal with serious debt situations by persons whose finances warrant their appointment in view of the fact that the charging of VAT to this necessary work is unwarranted in the context of a Government approved debt resolution regime; and if he will make a statement on the matter. [28623/13]

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Written answers

I have been advised by the Revenue Commissioners that a Personal Insolvency Practitioner (PIP) will be involved in the Debt Settlement Arrangements and Personal Insolvency Arrangements as provided for in the Personal Insolvency Act 2012. Any fees charged by a PIP in connection with these services are liable to VAT at the standard rate, currently 23%. A PIP in this regard is acting in a capacity similar to liquidators, receivers or examiners, whose services are also subject to VAT at the standard rate. Exemptions from VAT are to be construed strictly in accordance with the EU VAT Directive, Irish VAT law, and relevant decisions of the European Court of Justice. In this context, the activities of PIP practitioners do not fall within the exempted activities outlined under paragraph 6 of Schedule 1 to the Value-Added Tax Consolidation Act 2010 and as such are liable to VAT at the standard VAT rate.

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