ROS Revenue Online Queries
ROS helpline 01 7383699
Yes, as schools are employers and also principal contractors, they must be registered with ROS for payroll deductions and also for RCT and VAT returns. It is no longer possible to file paper returns with revenue.
Schools should apply online via Revenue.ie, ROS Registrations. There are three steps:
- Apply for ROS Access Number (RAN)
- Apply for your Digital Certificate
- Download and Save your Digital Certificate
Check Downloads, look for a P12 file and save it somewhere accessible.
If you are already registered on ROS for PAYE/PRSI ER you can add a new registration using Manage Registration on the services tab. If not, you can complete the TR1 form. Available on FSSU.ie or Revenue.ie.
Charitable Donations Scheme
There is not a requirement under the Charitable Donation Scheme to prepare audited accounts. Details as per Revenue website , Revenue have not requested an audit to date, but they are reviewing this at the present.
See summary requirements outline below, but view Revenue.ie for full information
VAT Compensation Scheme
For schools to qualify for the VAT Compensation Scheme they must provide the following:
- CRA Number from Charites Regulator
- CHY Number from Revenue
- School holds a current Tax Clearance Certificate
- Claims relate to one calendar year only and submitted no later then the 30th June the year following the calendar year to which the claim relates (i.e. first year 2018 for June 2019).
- Full set of audited accounts required for year in question. These accounts must be for the charity’s financial year and the year end of the financial year must be the year to which the claim relates or the year in which the claim is being made. So if school year runs from 1st September 2017 to 31st August 2018 and claim is 1st January 2018 to 31st December 2018 this will pose another problems for schools.
- VAT Invoice must be paid to the supplier
- To calculate qualifying income, a charity should deduct from its total income for the year to which the claim relates, all or any of the following, if applicable:
– educational fees received if the charity is a school, university, institute of
– technology or educational establishment,
– income from shops, restaurants and retail outlets,
– refunds or reliefs received under any other scheme or legislation administered by the Revenue Commissioners,
– funding, refunds, and reliefs received directly or indirectly from the state (i.e. DE)
- The amount which may be claimed under the scheme is referred to as “eligible tax” in the legislation and is the amount which a charity may claim under the scheme (i.e. the amount which is eligible to be claimed based on the level of non-public funding received).
- Claims not accepted under €500
- Note the total amount of claims in each year exceeds the capped amount of €5m any refunds due will be paid to charities on a pro rata basis. So after all that, the school may only get a portion of what they are entitled to get.
Revenue Tax Clearance Cert
There is no requirement for schools to have an up to date tax clearance certificate except where they are applying for grants from local authorities who may require proof of tax clearance. If all taxes are paid up to date i.e. VAT, PAYE etc, you can apply for your tax clearance cert under the ‘my services’ tab and click ‘manage tax clearance cert’ – see link below which gives more details.
RCT / VAT
For the purposes of RCT, such operations include
- Construction, alteration, repair, extension or demolition of buildings or structures
- Preparation for the operations above e.g. site clearance, laying of foundations, putting up of scaffolds
- Installation of systems such as alarms, air-conditioning, lighting, heating, sound proofing, ventilation, power supply, drainage, sanitation, water supply, fire protection or telecommunications
- External or internal cleaning of buildings during their construction, alteration or repair (excluding general maintenance)
- Hiring of plant and machinery for all above
It is important to note that professional fees relating to construction works (e.g. architects, quantity surveyors etc.) are not within the scope of RCT and where any part of a contract is for relevant operations then the contract as a whole is a relevant contract and all payments under that contract are liable for RCT.
- Typical building trade services supplied with the construction sector such as electricians, plumbers, bricklayers, plasterers, carpenters, glaziers, labourers, painters, etc.
- Refurbishment or fit out projects
- Contracts providing installation services, e.g. power supply, heat, light, air-con, telecom systems
- Repair, demolition, site preparation and clearance services (including skip hire) Haulage services in relation to construction materials
- Crane hire with operator
- Scaffolding hire with erection services
- Site clearance and provision of access routes
- Operation and maintenance contracts which include repairs
- Any operations necessary to rendering complete the development work
- Where a new building is under construction or an existing building is being refurbished, all the activities necessary to render the building complete would be considered to be construction operations
- In general, all construction operations that form part of ‘rendering a building complete’ are subject to RCT. This is why the likes of cleaning, laying carpets, plastering, painting, fitting, tiling, kitchens and bathrooms all fall under the RCT rules when they form part of a contract to build or renovate a building.
- Notify Revenue of all contracts with subcontractors online
- Notify payments online-before making the payments
- Receive deduction authorisation from Revenue in relation to that payment, indicating which rate (0%, 20% or 25%) of RCT to apply (which broadly will depend on the subcontractor’s tax compliance position). This is again prior to making the payment.
- Provide a copy or details of the Deduction Authorisation to the Subcontractor
- Submit monthly/quarterly returns online
- Make payments to Revenue of RCT deducted
If contract provides repair and maintenance than reverse charge should apply to any services carried out under that contract.
If contract provides that a separate charge should apply where repairs are necessary, then only the repairs element is subject to reverse charge – school charges itself the VAT @ 13.5%.
Supply and installation of fittings are not services within the scope of the reverse charge– separate invoice should be issued charging VAT at 23% for this element of the contract
The reverse charge will not apply to a supply of goods where that supply is not part of a construction service that is subject to RCT.
Yes, all schools must register for VAT as they must operate RCT on construction services. Schools may not claim VAT on purchases but must use the VAT reverse charge.
Generally, a School is VAT registered solely for the purposes of Relevant Contract Tax (RCT) on construction services supplied by a sub-contractor.
From March 2021 the school is only accountable for the Reverse Charge VAT on services supplied by a sub-contractor.
Schools registered for VAT solely for the purposes of reverse charge construction services are not obliged to self-account for VAT on goods they purchase from other EU Member States, (including Northern Ireland).
I.E. Where a school buys goods from another EU country or Northern Ireland, the supplier’s invoice should be inclusive of VAT at the relevant rate in that EU country. The school should pay the invoice including the VAT to the supplier. No VAT needs to be returned in the VAT return.
Schools registered for VAT solely for the purposes of reverse charge construction services are not obliged to self-account for VAT on services received from outside the State. The school should pay the invoice including the VAT to the supplier.
Where a subcontractor who is not resident in the state provides construction services, these services are subject to Relevant Contract Tax (RCT) rules. VAT is due on this supply, even where the subcontractor does not provide an Irish VAT number. Where the invoice for construction operations that is subject to RCT is presented to a school, and the invoice shows a charge to foreign VAT, the foreign VAT should not be paid. The school should calculate the Irish VAT due at 13.5% on the VAT exclusive amount shown on the invoice and show this amount on their VAT return.
Under the circumstances described above, the only VAT schools need to return is Reverse Charge VAT on construction operations. This VAT should be included in the “T1 box VAT on Sales”. The “E2 box Total goods from other EU countries” should be zero, as there is no requirement to account for VAT on goods purchased from the EU.
You should continue to file Nil returns, where there is no VAT liability.
*Northern Ireland continues to be subject to the same EU VAT rules on goods as other EU member states.
RCT/VAT payments are recorded against the same expense code as the construction service they relate to. For example; if the payment to the contractor is posted to Minor Works expense then the RCT/VAT payment is posted to Minor Works expense. Similarly, if the construction payment is posted to repairs and maintenance, then the RCT/VAT is posted to repairs and maintenance.
A capital construction project of €10,000, with a 20% RCT deduction would be posted as follows:
DR 3900 Capital Building Grant Income €10,000
Cr 3940 Capital Building Grant Expense €7329 payment to Contractor
€1482 RCT deduction
€1189 VAT payment to Revenue