Farm business committee chair for the Irish Farmers Association (IFA), Rosemary McDonagh has said that not being able to reclaim VAT on computerised calf feeders is causing “huge concern” for farmers.
Revenue have confirmed that it does not consider computerised calf feeders as movable goods, and they are therefore not eligible for VAT reclaim.
Farmers who are unregistered for VAT and opt for the Flat Rate Farmer’s Scheme have a long-standing arrangement for VAT charged to them on their purchases of goods and services.
This allows farmers to retain what is known as a ‘flat-rate addition’ onto the amount that they charge for the agricultural goods and services they supply in the course of their farming business.
The flat-rate addition is calculated as a percentage of the amount payable to the farmer and is based on the commercial agreements between the farmer and the customer.
The scheme is designed to reduce the administrative burden on farmers and to allow them to remain outside the normal VAT system.
Unregistered farmers may also be able to claim refunds on outlays incurred on the construction, extension, alteration or reconstruction of a farm building or structure, on fencing, draining and reclamation of farmland, as well as solar panels.
The refund order does not provide for relief from VAT suffered on the acquisition of movable goods, such as farm machinery.
VAT on bolted feeders
Farmers have voiced concerns to Agriland over whether or not computerised feeders that are either bolted to the floor, or set in concrete would be considered for VAT reclaim.
Farmers that were previously able to reclaim VAT on these feeders are now being denied the reclaim.
Revenue have confirmed to Agriland that there has been no change in the rules in recent years.
IFA business chair Rosemary McDonagh said that the IFA is engaging with Revenue over the issue and has sent letters to the Department of Agriculture, Food and the Marine (DAFM).
“If the law hasn’t changed, you’d wonder who’s reading it differently then they used to then,” McDonagh said.
She added that costs in construction have increased and “not kept up with inflation rates”, meanwhile Targeted Agricultural Modernisation Scheme (TAMS) approval has “slowed down”.