Ireland Updates VAT Guidance on Debt Factoring and Invoice Discounting

• Irish Revenue updated its VAT guidance on debt factoring and invoice discounting via eBrief 093/26, with changes taking effect from 20 May 2026.
• The update reflects the CJEU ruling in Case C-232/24 (Kosmiro), revising the manual’s paragraph 5 and Appendix 1.
• Debt factoring and invoice discounting are generally treated as standard-rated VAT supplies, typically as a single debt-collection service, including related financing/advance-funding elements.
• Separate sales of debts or non-performing loans are VAT-exempt, and separate credit/financing supplies are also exempt; acquiring debts below face value is not a VAT supply.
• Common related fees such as take-on, arrangement, software, collect-out, legal/enforcement, and credit status report fees are generally taxable at the standard rate, with VAT recovery depending on taxable vs exempt use.

Source: regfollower.com

Note that this post was (partially) written with the help of AI. It is always useful to review the original source material, and where needed to obtain (local) advice from a specialist.

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