Dáil Éireann Debate, Wednesday - 20 March 2024
217. Deputy Michael Ring asked the Minister for Finance if he will introduce an annual threshold for VAT free barter similar to other EU countries (details supplied); and if he will make a statement on the matter. [11608/24]
View answer218. Deputy Michael Ring asked the Minister for Finance to clarify the necessity for a VAT transaction (details supplied); and if he will make a statement on the matter. [11610/24]
View answer226. Deputy Michael Ring asked the Minister for Finance if the bartering of education, that is, classes, lessons, grinds and so on, is exempt of VAT; and if he will make a statement on the matter. [11936/24]
View answerI propose to take Questions Nos. 217, 218 and 226 together.
I am advised by Revenue that the VAT registration thresholds are subject to the requirements of EU VAT law, with which Irish VAT law must comply. Ireland’s threshold for a business supplying services is €40,000, and our threshold for a business supplying goods is €80,000. Businesses whose annual turnover is below these levels are not obliged to register for VAT, although they may elect to do so.
The Deputy is specifically asking about barter trade, and while no money changes hands, barter transactions are supplies of goods or services and are subject to VAT. The VAT is payable by reference to what might reasonably be expected to be the open-market (arm’s length) price of the goods or services supplied. Barter transactions are subject to the same formal requirements as cash transactions as provided for by VAT law and as such, the registration thresholds referred to above encompass barter transactions.
Currently, EU VAT law provides that registration thresholds may only be raised by Member States to maintain their value in real terms, that is, they may not be increased above inflation. As part of Budget 2024, Ireland’s VAT thresholds were increased to their current values with effect from 1 January 2024.
The Deputy may wish to know that the VAT SME Package will enter into force across the EU on 1 January 2025. The amendments to the VAT Directive under this package will introduce an upper registration threshold limit of €85,000 for Member States.
In relation to education services referred to by the Deputy, the supply of children’s or young people’s education, school or university education, and vocational training, are exempt from VAT. This includes services supplied by private tutors covering school or university education or instruction relating directly to a trade or profession as well as any instruction aimed at acquiring or updating knowledge for vocational purposes. No VAT is due on supplies of such services including in the case of bartering.
