Reverse Charge Ireland

Hi catnonie Just to clarify, do you have the Irish version of the online product?🤔

Hi. Yes I have the Irish version. Thanks

Hi catnonie, 

There should be a default reverse-charge VAT code 'RCS' which you can use on the supplier invoice, please check you have all of the default tax codes enabled by going to Taxes > Edit Tax > Edit rates > Select the small cog wheel > Select include inactive. 

Please get back to us below if you're having any trouble finding this 🧐

No I dont have it on my list.

I tried to set it up but it doesn't seem to pull into VAT return correctly.

Any ideas how I set it up from scratch.

Thanks a mill.

Hello Catnonie, 

Could you send us a screenshot of your vat codes page please make sure they are all made active for us as well so we can have a look into this for you. 

Hi, see attached screenshot below.  The Reverse Charge VAT Code that's there is one i tried to set up myself, but the transactions don't seem to pull into the VAT return correctly. Thanks

My quickbooks still has the RCS code at 23%  - this is now updated to 21% since September 1st. and QB will not let me enter any UK invoice with the RCS code. 

This was working fine up until September 1st. 

I am using Quickbooks online.

Thanks for joining this conversation, @John Melody.

Your browser may be already full of frequently accessed page resources (cache and cookies) causing this odd behavior. To fix this, try signing into QuickBooks Online (QBO) using a private browser (incognito).

Here's how:

• Press Ctrl + Shift + N (Google Chrome).
• Ctrl + Shift + P (Firefox).
• Control + Option + P (Safari).

Once logged in, try to create a test invoice and choose the RCS code to double-check. Here's how:

1. Go to the + New option at the top left to create an Invoice. 
2. Click the VAT drop-down and select the RCS code.
3. Hit Save and close to complete.

If everything looks good, return to your default browser and perform a clear cache to refresh the system. However, if the issue persists, try using other supported browsers.

For more insight about UK/EC VAT codes, please refer to this article: Common VAT Codes.

Please let me know if you have any other questions or concerns by leaving a comment in this thread. I'll be here to help. Have a wonderful day!

I am having the same problem but the RCS code you mention is putting the transaction into EU services. I don't want it to report as EU purchases of goods or services as that is not what it is. Is there anyway to set up a similar vat i.e. a positive and a negative, but to report under normal purchases and not EU.

Jello Omega2011, thanks for commenting on this thread, this link will help you in regards to what vat code to put against your transactions. 

That link shows only UK vat codes. I am looking for help for the past week on what code I should either have on the Irish system or need to set up to correctly allocate domestic reverse charge vat / notional vat. The RCS code is reverse charge for EU services and so does not work. I have a purchase invoice from a sub-contractor - he is due to be paid the net figure on that invoice and we, as the Principle Contractor must account for the vat element in our return. We can take a corresponding credit against it. Can anyone tell me how I get this set up please.

Hello there, omega2011,

The link provided by my colleague is where you can set up the reverse charge. You can scroll down and follow instructions under EC VAT codes section on how to allocate the domestic reverse charge VAT.

If you aren't seeing the code on your QuickBooks Online account, I recommend consulting with your accountant for specific instruction.

I've also added this link about the latest update: https://www.gov.uk/guidance/vat-domestic-reverse-charge-for-building-and-construction-services#overv....

Or visit this page for more details: VAT: domestic reverse charge for building and construction services.

Keep me posted if you need additional information by commenting below. I'll be around to help you.

I'm wondering if you got this sorted and, if so, can you please tell me what I need to do to set it up on the irish version of quickbooks.

Any help would be much appreciated. 

Sorry only catching up but would like to help you.  Is it online?  If so the instructions I used are: let me know if this helps

Reverse Charge QuickBooks Online

Creating a tax code for a reverse charge transaction in QuickBooks.

• Taxes
• Edit Collector General
• Edit Rates
• Add Tax Rate
• Name e.g. RCT Reverse Charge
• Description - RCT Reverse Charge
• Tax Agency - Collector General
• Sales
  • Sales Rate % - (23%)
  • Account - Liability
  • Show Tax Amount on Return Line – Tax Collected on Sales
  • Show Net Amount on Return Line – Total Taxable Sales in Period, before Tax
• Purchases
  • Purchase Rate % - (-23%) (Negative)
  • Account – Liability
  • Show Tax Amount on Return Line – Tax Reclaimable on Purchases
  • Show Net Amount on Return Line – Total Taxable Purchases in Period, before Tax
• Save
• Enter the transaction e.g. €640 RCT Reverse Charge
  • Subtotal                                   640.00
  • Revenue @-23% on 640.00         0.00
  • Total                                        640.00
• Transaction should appear on VAT Return as an in and an out in Sales and Purchases.

Hi, 

No I am afraid this is still not sorted.  I still cannot enter an invoice from an EU supplier using the RCS VAT code. Quickbooks gives an error when you try to save the transaction. I have reported it to QB and they logged a case and they have said that there is a problem with QB online and they are working to come up with a solution. I got a note from the QBCare team earlier this week saying that they expected a solution was imminent but it has been over 2 months now since I reported the problem originally so I am not sure what that means. 

As I said earlier this only started happening after the Irish government changed the VAT rate on 1st. of September 2020 from 23% to  21%. Prior to this change the RCS VAT code worked perfectly on QB online. 

This is the correct code for these type of transactions  as the VAT is recorded as a self-supply and it gets added into both sides of the VAT 3 report - this is necessary so that the VAT3 report generates a correct ES2 value. However, it does not affect the VAT liabiliity. 

Is this the same problem you have? 

Yes, it is QB Online. 

I have no problem with the actual RCS code or creating it. In fact it is already built-in and updated to the latest standard rate tax rate in Ireland which is 21% - all that is OK. 

My problem is trying to enter an invoice from a supplier that needs an RCS vat code. 

QB Online will not accept the transaction - it says there is a problem and it cannot save the invoice. 

Thanks for your help. I have the RCS vat set up on the system also but did not have the opportunity in the accounts I am working on to use it. I just entered a transaction now and it is working fine for me. It feeds into the VAT3 return correctly also. This is what I need for what I am trying to input but not for EU transactions. It is a domestic transaction from a supplier in Ireland and I need to show the vat both in sales and purchases. 

Just further on this issue you are having - I entered two transactions using the RCS code, one in August and one in September and it picked the correct vat (23% in August and 21% in September). I got no warnings about any errors. 

What I am trying to do is the same thing but the supplier is an Irish sub-contractor. The company as the Principle contractor needs to pay the vat on the invoice over to revenue so I need the vat on the net invoice to show in purchases and sales.

I've tried that but when I get to 'Show Net Amount on Return Line (in sales and purchases) - the only options I have is Value of Goods / Services sent to other EU countries or Not Applicable. Since the EU options are not what I need I choose N/A. When I enter the transaction it shows up like a credit note in purchases and does not show in sales at all. Also, in my case the net of the invoice is 830 and the rate is 13.5% so the vat on that should be 112.05 but the system is showing the vat at 129.54.

My understanding of RCS is this is the code to use for services from EU countries (not domestic) where a reverse charge at the standard rate (currenty 21%)  applies. I have never used the RCS code for domestic invoices so I don't have any experience of how it applies in that case. 

Some of my suppliers bill us in UK Sterling and some bill in Euros. In both cases I get the error i.e. whether the supplier is configured as a GBP account or EUR account. I simply cannot save the bill in QB ONLINE if I set the VAT code to be RCS. 

Hi there, John.

It looks like we have an open investigation about errors with RCS code when saving a bill in QuickBooks Online. Our engineers are already checking on this one to determine what's causing the issue and create a permanent fix as well. 

Please contact our Chat Support Team so they can add you the list of affected users. Here's how:

1. Click the Help menu and select Contact Us.
2. Enter a brief description or type in the error message in the description bar. then click Let's talk.
3. Click Start a chat.

If you're using QBO UK, you might also see this option when reaching out to our support team: 

1. Click Help in the upper right-hand corner of QBO.
2. Click Talk to a human, then type in Talk to a human.
3. Select I still need a human.
4. Click Contact Us.
5. Select between Send a message or Get a callback.

Once added to the list, you'll get notified via email as soon as the issue is resolved. Let me know if you need anything else. 

That's very strange John as it is working fine for me. I don't need it in the company I am working on currently but just tried it to see if I had the same problem as you and surprisingly I don't. I will use it a lot when I move over another company in Jan. next to the online accounts. However, if I can't get the domestic reverse charge working for Ireland I won't be moving any more companies over. I was told to use RCS code but as it is reverse charge on EU supplies that is incorrect. Catonie on this list went to the considerable trouble of listing out the steps I need to take in setting up a new vat code but on the Show Net amount return line - I obviously have different selections as mine are limited to either EU sales or services (which is not what I want) or not applicable. I have tried journal entries to get it into the VAT3 but nothing seems to be working. I used quickbooks desktop for 30 odd years and it was a simple procedure to set up whatever vat you required. It seems to me that the online version (for Ireland anyway) is sadly lacking. I would have thought that once it came on sale here, it would be set up for all the vat codes that operate here - I certainly thought wrong. 

Yes, I have similar experience. We have used QB desktop for almost 30 years as well and just moved over to QB Online this summer. Sigh ! 

The RCS VAT code was already built in to the QB Online system so it was all pre-configured and worked fine until the VAT rate changed on September 1st. So I was able to enter UK or other EU invoices prior to Sept. 1st. without a problem. However, since then I get an error anytime I try to save the bill using the RCS code. 

QB support have said their engineers know what the problem is and are working on a FIX. However, it is over 2 months since I logged the problem and also two VAT 3 filing periods have passed. 

It is very interesting though that your are able to enter a bill with the built in RCS code and I am not. 

I only set up one online company at the end of October so maybe the fact that I had no entries prior to the vat change is why I can use the RCS code. I'm disappointed because I loved the desktop versions and was watching for ages for an online version for Ireland. Also, last week when I could not get back in to my company, I kept getting a link to the Quickbooks ireland web page for help but it is frozen so any link you need to use does absolutely nothing. I asked them to flag that fact and get it sorted but it's still the same today. I think I'll be going back to the desktop and saving the headaches!