STATUTORY INSTRUMENTS.

S.I. No. 254 of 2000.

VALUE-ADDED TAX (APPORTIONMENT) REGULATIONS, 2000

S.I. No. 254 of 2000.

VALUE-ADDED TAX (APPORTIONMENT) REGULATIONS, 2000

The Revenue Commissioners, in exercise of the powers conferred on them by sections 12 and 32 of the Value-Added Tax Act, 1972 (No. 22 of 1972) , make the following Regulations:

1. These Regulations may be cited as the Value-Added Tax (Apportionment) Regulations, 2000.

2. These Regulations shall come into operation on 1 September 2000.

3. In these Regulations--

“Principal Act” means the Value-Added Tax Act, 1972 ;

“accounting period” means a period of 12 months ending on 31 December 2000 and on each 31 December thereafter, but if a taxable person customarily makes up accounts for periods of 12 months ending on another fixed date, an accounting period is a period of 12 months ending on that fixed date;

“authorised officer” means a person authorised for the purposes of section 18 of the Principal Act;

“final accounting period” means the period from the end of the previous accounting period to the date that a person ceases to be a taxable person;

“review period” means a period consisting of all the taxable periods which end during an accounting period.

4. In these Regulations--

(a) a reference to a Regulation is to a Regulation of these Regulations, and

(b) a reference to a paragraph is to a paragraph of the Regulation in which the reference occurs,

unless it is indicated that reference to some other provision is intended.

5. (1) Where a taxable person deducts, in accordance with subsections (1) and (4) of section 12 of the Principal Act, a proportion of the tax borne or payable on the taxable person's acquisition of dual-use inputs for a taxable period that proportion of tax deductible by that person for a taxable period shall be--

(a) the proportion which--

(i) correctly reflects the extent to which the dual-use inputs are used for the purposes of that person's deductible supplies or activities, and

(ii) has due regard to the range of that person's total supplies and activities,

for that taxable period,

(b) the proportion which was calculated as being the proportion of tax deductible for the review period immediately preceding the taxable period in question,

(c) the proportion which that person estimates will--

(i) correctly reflect the extent to which the dual-use inputs will be used for the purposes of that person's deductible supplies or activities, and

(ii) have due regard to the range of that person's total supplies and activities,

for the review period in which that taxable period ends, or

(d) any other proportion of tax deductible which is arrived at in accordance with paragraph (3) of this Regulation.

(2) Where a taxable person estimates a proportion of tax deductible for a taxable period in accordance with paragraph (1)(c), then the taxable person shall submit, at the same time as the return required to be furnished in accordance with section 19(3) of the Principal Act for the taxable period in question, details setting out the basis for that estimate to the office of the Revenue Commissioners which would normally deal with the examination of the records kept by that person in accordance with section 16 of the Principal Act.

(3) If an authorised officer is satisfied that the proportion of tax deductible estimated in accordance with paragraph (1)(c) does not correctly reflect the extent to which the dual-use inputs will be used for the purposes of the taxable person's deductible supplies or activities and does not have due regard to the range of that person's total supplies and activities for the review period in which the taxable period ends, then that officer may direct that taxable person to use a proportion of tax deductible in accordance with subparagraph (a) or (b) of paragraph (1) or any other appropriate proportion which that officer agrees with that person.

6. (1) A taxable person who deducts, in accordance with subsections (1) and (4) of section 12 of the Principal Act, a proportion of the tax borne or payable on the taxable person's acquisition of dual-use inputs shall, at the end of each review period, calculate the proportion of tax deductible for that review period and shall, if necessary, in accordance with paragraph (2), adjust the amount of tax deducted in that review period to ensure that it correctly reflects the extent to which the dual-use inputs were used for the purposes of that person's deductible supplies or activities and had due regard to the range of that person's total supplies and activities for that review period.

(2) Any necessary adjustment under paragraph (1) shall be made by way of an increase or decrease, as the circumstances may require, in the amount of tax deductible by the taxable person, for--

(a) the taxable period next following the end of the review period, or

(b) such later taxable period which is agreed between the taxable person and an authorised officer,

but if the adjustment relates to that person's final accounting period any necessary adjustment shall be made by way of an increase or decrease in the amount of tax deductible for the taxable period in which that final accounting period ends.

(3) Any adjustment in accordance with paragraph (2) shall be made in the return required to be furnished in accordance with section 19(3) of the Principal Act for--

(a) the taxable period next following the end of the review period, or

(b) such later taxable period which is agreed between the taxable person and an authorised officer,

but if the adjustment relates to that person's final accounting period any necessary adjustment shall be made in the return required to be furnished in accordance with section 19(3) of the Principal Act for the taxable period in which that final accounting period ends.

(4) Any increase or decrease in the amount of tax deductible resulting from an adjustment of tax deductible made in accordance with this Regulation, shall be disregarded in calculating the proportion of tax deductible for the review period in which that adjustment was made.

7. Where a taxable person adjusts, in accordance with Regulation 6, the amount of tax deductible for a review period and subsequent to that adjustment it is established that that adjustment was incorrect, then the provisions of section 21 of the Principal Act shall not apply to any additional liability for tax arising out of the correction of that adjustment but only if--

(a) that person, or any person acting on his or her behalf, did not act fraudulently or negligently in relation to that adjustment,

(b) that person submitted, by the due date for submission of the return referred to in Regulation 6(3), details setting out the basis on which the adjustment was made to the office of the Revenue Commissioners which would normally deal with the examination of the records kept by that person in accordance with section 16 of the Principal Act, and

(c) that additional liability is not the subject of an assessment of the tax under section 23 of the Principal Act.

8. Regulation 16 of the Value-Added Tax Regulations, 1979 ( S.I. No. 63 of 1979 ), is hereby revoked with effect as on and from 1 September, 2000.

EXPLANATORY NOTE

(This note is not part of the Instrument and does not purport to be a legal interpretation.)

These Regulations deal with the proportion of tax deductible by a person for a taxable period in relation to his or her acquisition of dual-use inputs for the purposes of his or her business. They also provide for the adjustment of the amount of tax deducted in respect of a review period. They replace Regulation 16 of the Value-Added Tax Regulations, 1979 ( S.I. No. 63 of 1979 ).