Finance Act 2013 saw a number of changes to the VAT regime in Ireland. The main changes are as follows:
a) New provisions were introduced to clarify that a receiver or liquidator who supplies taxable services in the course of either carrying on a business or winding up a business is liable for VAT on those services and/or rents.
b) The liquidator and/or receiver is obliged to register for VAT, file VAT Returns and make the relevant payment of VAT in relation to the taxable supply.
c) Where an immovable good is sold by a receiver or liquidator and where a joint option to tax the sale is exercised thereby making the purchaser accountable for VAT on a reverse charge basis, then subject to the normal deductibility rules, the purchaser is entitled to deduct the VAT incurred.
d) Provisions were introduced transferring the obligations of the capital good owner to the receiver for the duration of the receivership including maintaining the capital good record, calculating any adjustment in deductibility resulting from the change in use of the capital good, remittance of tax, etc. and for the reversion of those obligations to the capital good owner at the end of the period of receivership. There is also provision for the apportionment of VAT liabilities or input credit entitlements where receivership or possession commences or ends during a capital goods scheme interval.
In the recent High Court case of Ryanair Ltd v Revenue Commissioners  EHC 195, Laffoy J held that Ryanair was not entitled to a VAT deduction on the professional fees incurred in connection with its bid to acquire the share capital of Aer Lingus.
Revenue Commissioners refused Ryanair’s refund claim following an unsuccessful bid to acquire the entire share capital of Aer Lingus because the VAT on professional fees was not part of the general costs of its business as transport operator i.e. it did not form an integral part of its overall economic activity and had no connection with its general business. The matter was appealed to the Circuit Court which upheld Revenue’s decision. The High Court held that the Circuit Court Judge was correct in law.
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