Revenue eBrief No. 173/21
Guidelines for the application of Section 108B VAT Consolidation Act 2010
Tax & Duty Manual Guidelines for the application of Section 108B of VAT Consolidation Act 2010 provides information on circumstances where persons may be served a notice to issue a document which is in the same format as a VAT invoice in respect of all supplies for which a VAT invoice has not been issued.
3. Purpose of issuing a Notice under section 108B
To assist in the prevention and detection of tax evasion, the Revenue Commissioners may issue a notice to a supplier under section 108B of VATCA 2010. The purpose of issuing a notice under the new legislation is twofold:
(a) to change behaviour by forcing the passive or complicit supplier to fully comply, in appropriate circumstances, with invoicing obligations, and
(b) where no VAT invoice is issued, to identify the customers making cash purchases. For each taxable supply made during the specified period, the supplier must issue either:
(a) a VAT invoice in accordance with section 66(1)(a) or
(b) a document, at the time of the supply, which contains all of the same information that is required by Regulation 20(2) of the VAT Regulations 2010 to be included on a VAT invoice issued in accordance with section 66(1)(a). This document is referred to hereafter in this instruction as a “section 108B document”.
The issue of a simplified invoice (in accordance with section 66(1)(b)) does not exclude a supplier from the obligation to issue a section 108B document. The requirement to issue either a full VAT invoice or a section 108B document will ensure that the supplier’s records will contain information which may assist in the identification of supplies into the shadow economy and the traders concerned. Equally, it should result in a positive behavioural change as the supplier will have to consider the risks of making supplies to accountable persons without issuing an invoice.