How to Calculate Ireland VAT

Ireland's Value Added Tax (VAT) is a consumption tax applied to goods and services. The standard rate is 23%, with reduced rates of 13.5%, 9%, and 4.8% (super-reduced), plus a zero rate for certain supplies. VAT is administered by the Irish Revenue Commissioners. Ireland is an EU member state and its VAT system is harmonized with EU rules.

Adding VAT to a Price

When you need to add VAT to a VAT-exclusive price, use these formulas:

Example for 23% standard rate: If the base price is €100 (excluding VAT):

VAT Amount = €100 × 0.23 = €23.00

Total Price = €100 + €23.00 = €123.00

Example for 13.5% reduced rate: If the base price is €100 (excluding VAT):

VAT Amount = €100 × 0.135 = €13.50

Total Price = €100 + €13.50 = €113.50

Removing VAT from a Price

When you need to calculate the VAT-exclusive price from a VAT-inclusive price, use these formulas:

Example for 23% standard rate: If the total price is €123 (including VAT):

Base Price = €123 ÷ 1.23 = €100.00

VAT Amount = €123 - €100 = €23.00

Understanding Ireland's VAT System

What is VAT in Ireland?

Value Added Tax (VAT) is Ireland's consumption tax. It's collected at each stage of the supply chain with the final burden on consumers. The Irish VAT system is harmonized with EU VAT rules as an EU member state. Businesses can claim input tax credits for VAT paid on business purchases.

The Five Irish VAT Rates

Standard Rate (23%): Applies to most goods and services including electronics, clothing, motor vehicles, alcohol, tobacco, professional services, and most items not covered by reduced rates.

Reduced Rate (13.5%): Applies to essential goods and services including:

• Hotel accommodation and short-term lodging
• Restaurant and catering services
• Admission to cultural and sports events
• Construction services and certain materials
• Hairdressing and beauty services
• Veterinary services
• Art, antiques, and collectibles
• Theatre and entertainment services

Reduced Rate (9%): Applies to specific items and services including:

• Newspapers and magazines (printed and digital)
• Sporting facilities and activities
• Gas and electricity (temporary rate extended to 31 October 2025)
• Tourism-related services
• Certain print publications

Super-Reduced Rate (4.8%): Applies to:

• Livestock intended for preparation of foodstuffs

Zero Rate (0%): Applies to specific supplies:

• Exports of goods from Ireland
• Most foodstuffs (bread, milk, vegetables, meat, fish)
• Books (printed and physical media)
• E-books and audiobooks (since 2024)
• Children's clothing and shoes
• Disability aids and medical devices
• Intra-community supplies to other EU states
• International passenger transport
• Newspapers and news periodicals (digital and print)
• Health products (period products, defibrillators, NRT)
• Solar panels on school buildings and equipment

VAT Registration Requirements

Businesses in Ireland must register for VAT if:

• Annual turnover exceeds €40,000 for services
• Annual turnover exceeds €80,000 for goods
• Cross-border sales exceed €10,000 EU threshold
• Non-residents engaging in Irish business - Must register and appoint VAT representative

Businesses below the threshold can voluntarily register for VAT.

VAT Filing and Compliance

VAT-registered businesses in Ireland must file VAT returns with the Irish Revenue:

• Bi-Monthly VAT Returns: Most businesses file every two months
• Monthly Returns: Some larger businesses may file monthly
• Annual Returns: Year-end reconciliation required
• Payment Deadline: Payment due 21 days after return period end
• Electronic Filing: All returns filed electronically via ROS (Revenue Online Services)
• Penalties: Late submissions can incur fines up to €4,000 plus daily interest

VAT-Exempt and Special Supplies

Exempt Supplies (No VAT, No Input Credit)

Some supplies are exempt from VAT, meaning businesses cannot claim input tax credits:

• Healthcare Services: Medical and dental services by healthcare professionals
• Education: Educational services by approved educational institutions
• Financial Services: Banking, insurance, investment services (mostly)
• Betting and Gambling: Lottery, gaming, and betting services
• Property Transactions: Sale and lease of real property (mostly)
• Social Services: Social welfare and care services
• Postal Services: Universal postal services by An Post
• Burial Services: Burial and cremation services

Items Subject to 23% Standard Rate

The following are subject to standard 23% VAT:

• Electronics and appliances
• Clothing and footwear (except children's)
• Motor vehicles and parts
• Alcohol and tobacco
• Professional services
• Most entertainment services
• Furniture and household goods
• Petrol and diesel fuel

Items Subject to Reduced Rates (4.8%, 9%, 13.5%)

The following are subject to reduced VAT rates:

• 4.8% Rate: Livestock for food preparation
• 9% Rate: Newspapers, magazines, sporting facilities, gas/electricity (temporary)
• 13.5% Rate: Hotels, restaurants, cultural events, construction, hairdressing, veterinary

Ireland VAT Quick Reference

Frequently Asked Questions (FAQ)