VAT is governed by the EU VAT Directive (Council Directive 2006/112/EC), with which Irish VAT law must comply. The Directive provides that VAT registration thresholds may only be raised by Member States to maintain their value in real terms, that is, they may only be increased in line with inflation. Our VAT thresholds were increased to their current values, €37,500 for services and €75,000 for goods, on 1 May 2008 and as the Central Statistics Office figures show the consumer price index is below the level it reached in 2008, it is not possible to increase these thresholds.
Ireland’s VAT registration thresholds for small enterprises and the self-employed are among the highest in the EU. In addition, SMEs benefit from a range of VAT simplification measures including simplified and electronic invoicing, special schemes for retailers and pharmacists, the facility to make VAT returns on a bi-annual or annual basis, the cash receipts basis of accounting where the trader is not required to pay VAT until payment for the supply is received, the facility for small businesses to submit an annual VIES return rather than monthly and the Mini One Stop Shop (MOSS) which allows business to register, file and pay VAT due in all Member States through the Irish MOSS system.