VAT Return of Trader Details (VAT RTD) Introduction of Automated Compliance Measures Created July 2014 Contents 1.1 Changes to Debits/Credits Processing...3 1.2 Addition of VAT RTD to Notice of Returns Outstanding Letter...4 1.3 Changes to VAT RTD details in ITP Customer Screen...5 2. AMENDMENT OF VAT RTD IN ITP...7 2.1 Circumstances which may require amendment of VAT RTD...7 2.2 Procedure for amendment of VAT RTD...7 3. PROCESSING OF PAPER RTDs RECEIVED FROM efiling-exempt CUSTOMERS...11 4. MANUAL APPROVAL OF PAPER RTDS RECEIVED SINCE 1 MARCH 2013...12 5. FUTURE VAT RTD DEVELOPMENTS...13 6. CONTACT INFORMATION...13 1
INTRODUCTION: All registered VAT traders are required by Regulation 24(1) of the VAT Regulations 2010 to submit an annual Return of Trader Details (VAT RTD) Form. As previously notified to Customers last year, a number of operational measures and system improvements to the operation of the VAT Return of Trader Details (VAT RTD) are being implemented during the period 2013-2015 in order to simplify the online completion of the VAT RTD Form and to enforce compliance with statutory VAT RTD filing obligations. This Manual outlines a number of enhancements to the processing of the VAT RTD in the ITP system which have been delivered during June 2014. These enhancements may be summarised as follows: New Transactional Review (TR) work-item checks have been implemented to automatically withhold a repayment/refund of tax claimed under any taxhead where a VAT RTD is outstanding for the previous year; The VAT RTD is to be included in the Notice of Returns Outstanding Letter which is issued by the Office of the Collector-General; The VAT RTD screen in ITP has been updated to accurately display the correct period dates for the RTD; It will now be possible for Revenue Officers to make amendments to a VAT RTD via ITP when requested by the Customer or an Agent acting on their behalf. The operation of each of these new and enhanced functions is described in greater detail in the Sections below. 2
1.1 Changes to Debits/Credits Processing. At present, when a customer files a claim for repayment/refund of credit under any taxhead, a check for outstanding Returns for that customer is automatically initiated in the Debits/Credits system. Repayments/refunds may be automatically withheld if the customer is found to be non-compliant. From week beginning 16 June 2014, this automated compliance check will also incorporate an additional check for outstanding VAT RTD. ITP will automatically raise a TR work-item when there is an outstanding VAT RTD for the previous year only. The circumstances and workgroups in which a TR will be raised are summarised in Table 1 below: The following material is either exempt from or not required to be published under the Freedom of Information Act 2014. [ ] The refund to the customer will not be processed until all returns which are listed as outstanding (see Section 1.2) are received in ITP. An informational TR will be raised in the Workgroups listed in Table 1 when all outstanding returns are received. If the outstanding RTD is filed but in the meantime another return becomes overdue before the RTD is posted to ITP, an information TR will not be raised and the refund will not be processed. 3
1.2 Addition of VAT RTD to Notice of Returns Outstanding Letter If the VAT RTD is outstanding, then the VAT RTD will be added to the Notice of Returns Outstanding letter which is issued to customers by the Collector-General s Office (See APPENDIX 1). If the VAT RTD is still outstanding after twenty-one days, then a Notice of Returns Outstanding - Reminder Notice will be issued (See APPENDIX 2). If the Return is still outstanding thirty days after the reminder letter is issued, then a Notice of Returns Outstanding - Further Reminder letter will be issued (See APPENDIX 3). The following material is either exempt from or not required to be published under the Freedom of Information Act 2014. [ ] 4
1.3 Changes to VAT RTD details in ITP Customer Screen The VAT RTD will now be available in the Customer Financials screen in ITP. The relevant Return Period of the VAT RTD is the 12-month period prior to the VAT Accounting Year-end date selected by the Customer at the time of VAT registration. 1 Prior to June 2014 however, the relevant Return Period for a VAT RTD which was displayed in both ROS and ITP was incorrectly shown as the VAT 3 filing period in which the RTD was issued to the Customer, as shown in the example below: Figure 1. Incorrect VAT RTD Filing Period shown in ITP Return Screen To correct this issue, two new fields have been added to the Customer Financials screen to correctly display the correct return period of the VAT RTD: RTD Start Date RTD End Date 1 Note: Many customers may assume that the annual VAT RTD period coincides with the CT/IT accounting period of the business. It should be noted that the correct VAT RTD period is the 12-month period ending on the date of the VAT-accounting yearend. The VAT-accounting year-end date may differ from the accounting year-end date for CT/IT/PREM etc. purposes. The date of the VAT-accounting year-end is displayed in the Customer Profile screen in CRS should any difficulties arise. This date is normally provided by the customer at VAT Registration. 5
The RTD Start Date field will be based on a date which is twelve months previous to the VAT accounting-year end-date as indicated by the Customer and recorded in CRS at registration (Fig. 2). Figure 2. Return Detail Screen displaying new VAT RTD date fields. These two new fields will only be visible when the screen is opened to display a VAT RTD and will not be visible to users in any other scenario. 6
2. AMENDMENT OF VAT RTD IN ITP 2.1 Circumstances which may require amendment of VAT RTD In certain limited circumstances it may be necessary to input corrections or amendments to VAT RTDs after filing. These circumstances include: - genuine errors or omissions made by the customer or agent during completion of the VAT RTD Form in ROS; - submission of amended or supplementary VAT 3 Return(s) subsequent to the filing of the VAT RTD for that period; At present, there is no facility for agents or customers to input such amendments through ROS. Accordingly, in the two circumstances outlined above, it will be necessary for the Agent or Customer to contact the Customer Services Unit of the Office of the Collector-General (cgcustserv@revenue.ie) to request that the amendment be made. In addition to the situations outlined above, District compliance interventions or audits may also necessitate the amendment of VAT 3 values by agents or customers. In such cases, the relevant District compliance/audit officer must ensure that amendments to a VAT3 return arising from an intervention are also reflected in the RTD for that period by inputting a corresponding amendment to the relevant RTD using the procedures described in Section 2.2. In common with all statutory Returns, under no circumstances should VAT RTD values be amended by a Revenue officer without the express instruction or consent of the customer or agent. 2.2 Procedure for amendment of VAT RTD To enable amendment in these circumstances, the ITP system has been enhanced to allow a VAT RTD to be amended through the Return Detail screen in ITP. The process for amending a VAT RTD is largely identical to that currently used for amending a VAT3 in ITP. All fields on the VAT RTD will be amendable in the Return Detail screen with the exception of the Total fields as follows: Code Z1 Z2 Z3 Z5 Description Total Sales Total Acquisitions Total Purchases for Resale Total Other Deductions 7
In order to amend an RTD, the Return Detail screen can be opened by selecting the following ITP menu item: Functions > Input > Return/Est/Asst/Decl Following selection of this item, the Input Return screen will open. A new Amend VAT RTD option (Fig. 3) has been added to the Type dropdown menu in this screen: Figure 3. New Amend VAT RTD option in ITP. In order to input an amendment, it is necessary for the caseworker to first input the Start and End dates of the relevant RTD in the fields provided. It will therefore be necessary for customers and agents to provide these RTD period details when requesting that an amendment to an RTD be made. Once the required fields have been completed, pressing the Detail button will open the VAT RTD Return Detail Screen (Fig. 4). 8
Figure 4. VAT RTD Return Detail Screen To make an amendment to any of the line items in the table, the row to be amended must be selected by the user. If that row is amendable, both the Add button and the Current Value entry field will become enabled. The new value to be inserted may then be input in the data entry field in the lower part of the screen. After inputting the new value, the value in the Current Value field may be updated by pressing the Add button. The original value will now appear in the Previous Value column. When the VAT RTD line item has been updated, the user must press the Ok button to confirm the amendment. The user will then have to select an update reason in the Audit Trail screen that will appear. Once the reason is chosen, the VAT RTD change will be processed and completed. The total value of the VAT RTD fields will also be automatically validated when the OK button is pressed. If the sum totals of the fields do not balance, then an error message will be displayed (Fig. 5) and the update will not be processed. Figure 5. VAT RTD Validation Error Message When an amendment has been made to a VAT RTD, then the original VAT RTD in the Transactions List screen in ITP will be assigned a status of Inactive. This VAT RTD is no longer amendable. A new transaction line will be created entitled Amended RTD, and this item will have a status Active (Fig. 6). 9
Figure 6. Transactions List displaying Amended RTD An Amended RTD may, in turn, be subsequently amended. When this happens, the status of the Amended RTD will change to Inactive and a new Amended RTD will be created with a status of Active. 10
3. PROCESSING OF PAPER RTDs RECEIVED FROM efiling-exempt CUSTOMERS With mandatory e-filing applying to all but a small number of of VAT-registered traders, the VAT RTD Form has been available in ROS for the vast majority of traders and agents for several years. The availability of this service was highlighted to agents in the ebriefs published in July and November 2013 (see Section 1). Paper RTDs will continue to issue to the relatively small number of customers who have received efiling exemptions. The efiling-exempt status of the customer may be checked in CRS (Customer Basic) or ITP (Customer Financials>Customer Profile). Where a customer is recorded as having been exempted from mandatory efiling, paper forms will continue to be received by Inward Processing Unit of the Collector General s Office, in line with current practice. In order to ensure that the RTD filing compliance status of these customers is recorded correctly in ITP and repayments are not withheld incorrectly by the Debits/Credits system, efforts should be made to ensure that a VAT RTD Form received from an efiling-exempted customer should be posted to the external data management contractors at the earliest opportunity in order to enable inputting. It is not currently possible to input the date of receipt of a paper RTD directly to ITP. An enhancement which will allow for this function has been requested. Finally, in line with current practice, any paper RTDs submitted in error to District offices should also be forwarded to Inward Processing Unit, Collector-General s Office, Limerick. 11
4. MANUAL APPROVAL OF PAPER RTDS RECEIVED SINCE 1 MARCH 2013 The following material is either exempt from or not required to be published under the Freedom of Information Act 2014. [ ] 12
5. FUTURE VAT RTD DEVELOPMENTS In addition to the Revised VAT RTD functions described above, it should be noted that options for a number of additional online VAT RTD features are currently being considered, including the introduction of a limited number of additional fields to record the value of property disposals and acquisitions including those made as part of a Capital Goods Scheme. The following material is either exempt from or not required to be published under the Freedom of Information Act 2014. [ ] It is also intended that VAT RTD online amendment functionality will be added to existing ROS functionality. Other changes not listed above may also be introduced as the project is developed. All developments will be notified to staff and customers in advance of implementation. 6. CONTACT INFORMATION 13
Feedback which enables further improvements to operational systems and processes is always welcome. Any queries or comments on the issues raised in this Operational Instruction may be directed to: VAT & Business Projects Unit, Planning Division, Sarsfield House, Limerick. Email: PD_SC_Branch@revenue.ie 14
APPENDIX 1 Sample of Notice of Returns Outstanding letter with VAT RTD 15
APPENDIX 2 Sample of Notice of Returns Outstanding Reminder letter with VAT RTD 16
APPENDIX 3 Sample of Notice of Returns Outstanding Further Reminder letter with VAT RTD 17