Confusion has arisen over the VAT rate for peat bedding, with many farmers charged 23%
instead of 13.5% by companies, including Bord na Móna.
The confusion has stemmed from VAT on peat for horticulture which is charged at 23%, however, Revenue has told the Irish Farmers Journal: “The sale of animal bedding made from peat is liable to the reduced rate of VAT [13.5%].”
Peat bedding has seen a surge in demand given straw shortages this year and the Irish Farmers Journal understands that a number of large peat sellers have been selling peat bedding to farmers at a VAT rate of 23%.
Although the seller does not benefit from the increased rate, the onus is on them to repay the overcharged VAT to the farmer.
“Where a trader charges the incorrect rate of VAT on their supply, they should first issue a credit note for the original invoice and then issue a revised invoice showing the correct VAT,” Revenue stated.
“The recovery of any difference in the price resulting from the VAT change is a matter between the seller and the buyer.”
The confusion is widespread and even Teagasc has based estimates on a 23% VAT rate, calculating that a 27t arctic load of peat costs €1,581.
This would mean that farmers are paying on average €151 more than they should be on a load of a peat bedding.
Read more
Peatland used for agriculture should be ‘targeted’ for rewetting
Bedding concerns on Teagasc stand
Confusion has arisen over the VAT rate for peat bedding, with many farmers charged 23%
instead of 13.5% by companies, including Bord na Móna.
The confusion has stemmed from VAT on peat for horticulture which is charged at 23%, however, Revenue has told the Irish Farmers Journal: “The sale of animal bedding made from peat is liable to the reduced rate of VAT [13.5%].”
Peat bedding has seen a surge in demand given straw shortages this year and the Irish Farmers Journal understands that a number of large peat sellers have been selling peat bedding to farmers at a VAT rate of 23%.
Although the seller does not benefit from the increased rate, the onus is on them to repay the overcharged VAT to the farmer.
“Where a trader charges the incorrect rate of VAT on their supply, they should first issue a credit note for the original invoice and then issue a revised invoice showing the correct VAT,” Revenue stated.
“The recovery of any difference in the price resulting from the VAT change is a matter between the seller and the buyer.”
The confusion is widespread and even Teagasc has based estimates on a 23% VAT rate, calculating that a 27t arctic load of peat costs €1,581.
This would mean that farmers are paying on average €151 more than they should be on a load of a peat bedding.
Read more
Peatland used for agriculture should be ‘targeted’ for rewetting
Bedding concerns on Teagasc stand
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