Irish Revenue Updates VAT Registration Guidelines: New SME Scheme, Thresholds & Requirements

Irish Revenue has issued eBrief No. 168/25, announcing updates to the official Tax and Duty Manual Part 38-01-03b, which sets out revised guidelines for Value Added Tax (VAT) registration. These updates address application procedures, required turnover details, and introduce the EU VAT SME scheme clearances effective from 2025.

Updated VAT Registration Application Process

Section 3.4 now clarifies that complete and accurate information must be provided with every VAT registration application, whether submitted electronically or on paper. If essential details are missing, Revenue officers must contact the applicant or their agent for further information. A standard template query letter is also provided for such correspondence (Appendix 6).

Turnover Reporting & Registration Thresholds

Section 3.4.4 specifies that applicants must declare:

• Actual turnover for supplies of taxable goods and services from January 1 of the current year up to the date of application

• Prior year's turnover for the full calendar year

Revenue reiterates that registration is not mandatory for businesses whose turnover falls below the current threshold for accountable persons established in Ireland, but voluntary registration remains available.

The latest thresholds for VAT registration by activity (supplies, distance sales, etc.) are published and updated regularly by Revenue.

Introduction of the EU VAT SME Scheme

Section 10 introduces the EU VAT SME scheme, effective as of January 1, 2025. Under this framework:

• SMEs whose annual EU-wide turnover is below €100,000 and below domestic thresholds in Member States where supplies are made may use a simplified VAT registration process

• Registration under this scheme may be maintained so long as turnover stays within both the Union and local limits

• If turnover exceeds €100,000 across the EU, the SME must deregister from the scheme

The scheme is designed to reduce VAT registration complexity and compliance costs for SMEs operating cross-border within the EU.

Practical Implications

• Businesses should compile accurate, year-to-date and prior-year turnover figures when applying for VAT registration

• Those eligible for the EU VAT SME scheme can benefit from streamlined compliance when expanding or trading across the EU

• Voluntary VAT registration remains an option for businesses below the mandatory threshold

• Revenue officers will proactively query incomplete applications to ensure compliance and accuracy