Change To Cash Receipts Basis For VAT Purposes

Thousands of small and medium size businesses are currently availing of the cash receipts basis of accounting for VAT.  This is a valuable cash flow advantage for many businesses at a time when access to credit is limited.

By switching to the cash receipts basis VAT payable on sales is by reference to the date that cash is received and not by reference to the invoice date.

To avail of this option annual turnover had to be less than €1.25 million.  This limit will be increased to €2 million with effect from 1 May 2014.

In order to avail of this facility an application should be lodged with Revenue.  If you believe your business may qualify you should contact Cooney Carey to discuss what you need to do to qualify.

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