- Responding to a parliamentary question from TD Martin Kenny, Finance Minister Simon Harris explained Ireland’s VAT Flat-Rate Scheme—an administrative simplification for unregistered farmers. It lets them stay outside the VAT system yet be compensated overall for input VAT by adding and retaining a “flat-rate addition” on invoices to VAT-registered customers. [agriland.ie], [oireachtas.ie]
- The flat-rate addition is not a tax; it is a percentage farmers charge on top of their selling price and keep. It stood at 5.1% in 2025 and, per Budget 2026, fell to 4.5% from 1 January 2026. The livestock super-reduced rate (4.8%) remains unchanged. [agriland.ie], [vatfaqs.com]
- Governed by Articles 295–305 of the EU VAT Directive, the rate is reviewed annually (Article 296) using three years of CSO macroeconomic data. The formula: Flat Rate % = (VAT incurred by unregistered farmers on inputs ÷ agricultural output of unregistered farmers) × 100, applied on a three-year rolling average. [oireachtas.ie], [vatfaqs.com]
Sources: Agriland · Oireachtas (PQ) · Revenue.ie
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