Monthly direct debit

Value-Added Tax (VAT)

Revenue collects the direct debit payment for VAT on the third last working day of the month. You cannot select a different deduction date. It is collected in arrears so, for example, the payment collected in January 2023 covers the VAT you owe for December 2022.

Setting up a VAT direct debit

To be eligible to set up a direct debit for VAT you must:

  • file and pay any outstanding returns and taxes
  • have bi-monthly liabilities of €50,000 or less
  • apply through Revenue Online Service (ROS)
  • and
  • ensure that your monthly payments are large enough to cover your annual VAT amount.

Amending a VAT direct debit

You can change your bank details for your direct debit on ROS. You can increase the amount you pay monthly at any stage during the year on ROS.

You can also decrease the monthly amount, but only up to a maximum of three times during the VAT accounting period. Following a change, the system will update the value of your direct debits for the remaining months of your annual period plus one month.

You can also choose to suspend three direct debit payments during the annual period. You must ensure that after amending or suspending the direct debit you will still meet your expected annual VAT amount. Revenue can charge you interest if there is an underpayment.

Cancelling a VAT direct debit

You can cancel your direct debit at any stage through ROS. Once the direct debit is cancelled, you will receive a short annual return to complete. This allows you to bring your VAT returns up to date before you go back to standard filing.

VAT returns

If you are a direct debit customer, you only have to submit one VAT return per year. The return is due on the 19th day of the month after your VAT accounting period ends. The date of your current filing pattern also determines which month your direct debit will start.

Missed, or unpaid, VAT direct debit payments

Your bank may return your payment as ‘unpaid’. If it does, we will send a letter to inform you that the payment was unsuccessful.

It is your responsibility to pay the missed payment. You can pay the missed payment:

  • through ROS
  • or
  • by debit or credit card.

We may remove you from the direct debit scheme when direct debits are unpaid.

Next: Direct debit procedures for seasonal businesses