VAT Cash Accounting Scheme: Who Qualifies and What You Get
Learn how the VAT Cash Accounting Scheme lets you pay tax only after you receive payment from your customers.
The VAT Cash Accounting Scheme is a way for businesses to manage their value-added tax based on when money actually enters or leaves their bank account.
Who it's for
This scheme is available to businesses with an annual turnover of less than €2 million.
What you get
Instead of paying tax based on when you send an invoice, you only pay VAT when you actually receive payment from your customers. This helps keep more cash in your business during periods when customers are slow to pay.
What it costs you
To use this method, you will need to set up specific bookkeeping processes to track your payments accurately.
The catch to know
You cannot simply start using this method on your own; you must apply for and receive authorization from the tax office first.
How to apply
- Check that your annual turnover is below the limit.
- Organize your bookkeeping to track payments rather than just invoices.
- Submit an application to the Revenue Commissioners to request authorization.
- Check the official portal for the specific application steps.