Revenue eBrief No. 174/21
Guidelines for the application of Section 108C VAT Consolidation Act 2010
The Tax & Duty Manual Guidelines for the application of section 108C VAT Consolidation Act 2010 – Joint and several liability for tax provides information on cases where persons may be jointly and severally liable for tax.
Finance Act 2014 inserted a new section, 108C, in the VAT Consolidation Act (VATCA) 2010. Section 108C VATCA 2010 provides that where VAT has been fraudulently evaded, an accountable person who knowingly or recklessly participated in transactions connected to that fraudulent evasion of VAT is jointly and severally liable for the VAT that has not been remitted, and Revenue may notify him or her accordingly.
An accountable person does not have to be directly involved in the evasion of VAT in order to be jointly and severally liable.
VAT which has been fraudulently evaded will have been evaded by the person primarily liable for payment of that VAT (“first accountable person” in the legislation). However, the person to whom section 108C applies is the other person who is jointly and severally liable for that unpaid VAT, due to their participation in transactions involving the same good(s) or service(s) (“second accountable person” in the legislation).
Where particular goods or services pass through a chain of transactions involving a number of persons, any or all of those persons who knew or were reckless as to whether or not there was fraudulent evasion of VAT in relation to the supply of those goods and/or services, may be notified that they are jointly and severally liable for the unpaid VAT.