Finance Office - Procedures & Legislation

Prompt Payment

An EU law came into effect on 7 August 2002 to combat late payment in commercial transactions. This law was implemented in Ireland by Regulations which provide that penalty interest will become payable if payments for commercial transactions are not met within 30 days, unless otherwise specified in a contract or agreement.

At present the late payment interest rate is 8% pa (that is the current ECB rate of 1% plus the margin of 7%). That rate equates to a daily rate of 0.0222%. Penalty interest due for late payments are calculated on a daily basis. This interest is automatically calculated by the Agresso system from the first date of registration. This deduction is shown in your accounts as transaction type TX ref INTxxxxx

For more information visit the Revenue Tax Office

Tax Clearance Certificate

As a Public Body Dublin City University is required by law to obtain a current tax clearance certificate from all individuals, partnerships or companies in Ireland, EU or International with which it has dealings to the value of €10,000 or more (inclusive of VAT) in any twelve month period.

The Agresso system monitors this and notifies the buyer if the limit has been exceeded when the purchase order is being generated. If the supplier has reached the threshold for the first time the onus is on the buyer to obtain the certificate and submit it to the Finance Office where the supplier master file will be updated with the certificate number and renewal date.

The accounts payable section will then run a monthly report to ascertain any supplier whose certificate has expired and a renewal letter is sent to the supplier requesting an updated certificate.

For more information visit the Revenue Tax Office

Construction Industry and Relevant Contracts Tax (RCT)

RCT applies to Construction, Forestry and Meat processing operations. Any suppliers providing services within these categories are known as a sub-contractor with DCU being the principal contractor. Each sub-contractor must present his C2 (certificate of authorisation issued by the tax office) to DCU accounts payable office in person, a record of the card number and expiry date are recorded on the supplier master file. A RCT46 form is signed by DCU and the sub-contractor and returned to the revenue who then issues a RCT47 Payments card to DCU. Any payments made to the sub-contractor should be recorded on this card. If a sub-contractor does not have a C2 card the RCT47 cannot be applied for 35% is deducted from the gross amount of invoice and an RCT Deduction Card (FormRCT48) completed and given to the sub-contractor on payment. RCT30 is completed monthly for the total amount deducted from the sub-contractor.

The accounts payable section run a monthly report to ascertain any supplier whose certificate has expired and a renewal letter is sent to the supplier advising them that they should present their C2 card to the Finance Office.

Reverse Charge Vat In The Construction Industry On Services Subject To Relevant Contracts Tax (Rct)

From 01 September 2008 there is a change in how VAT is accounted for by Subcontractors. 

New Procedures

• The subcontractor will not charge VAT to the Principal Contractor ie invoices received will be NET of VAT.
• The Principal Contractor will calculate the VAT on the NET amount charged by the Subcontractor.
• The Principal Contractor will account for the VAT directly to Revenue in his/her VAT return.
• The invoice supplied by the Subcontractor will contain the statement “VAT on this supply to be accounted for by the Principal Contractor”.

For more information visit the Revenue Tax Office

Professional Services Withholding Tax: (WT)

Any payment made on an invoice where Professional services have been provided is liable to WT i.e. a reduction of 20% on the net value of the invoice as a requirement from the Revenue Commissioners. The sum of the reductions from each payee must be paid to the Revenue Commissioners each month.

A form (F45/2 from the Revenue Commissioners- "Withholding Tax from Payments for Professional Services") is completed on foot of Invoices received for Professional services work carried out for DCU.

A copy is given to the Professional concerned together with the reduced payment (80% of fees due).

In the case of a WT certificate being mislaid please contact the Finance Office.

To re-claim WT contact:

For more information visit the Revenue Tax Office

INTRASTAT

This a applies to imports of supply of goods within E.U. All invoices received in the Finance office are monitored for Intrastat. Invoices received from the EU are stamped `Intrastat' and are copied and filed for inclusion in the monthly Intrastat return.

For more information visit the Revenue Tax Office

VAT on Goods and Services Imported to Ireland

When goods/services are imported to Ireland from EU member countries we are liable to make a VAT Return at Irish VAT rates to the Revenue once those goods/services are utilised in Ireland.

RATES
ZS 21% Products
ZL 13.5% Services

The invoice received from the supplier should be VAT exclusive unless the supplier has an Irish VAT number.

If the goods/service are being utilised in the country of origin then there is no liability for Irish VAT you must pay the VAT of that country.

E.g. Travelling to UK for a conference.
Service is being utilised in the country of origin and is therefore liable to UK VAT NOT Irish VAT.

For more information visit the Revenue Tax Office