VAT obligations for payment service providers in Ireland

Council Directive (EU) 2020/284 in conjunction with Council Regulation (EU) 2020/283 provides for new record keeping and reporting obligations (CESOP measures) for in scope payment service providers (PSPs) providing relevant payment services within the EU.

The PSPs within the scope of the new measures are defined to mean any of the categories of payment service providers listed in points (a) to (d) of Article 1(1) of Directive (EU) 2015/2366 (the Payment Services Directive) and these are:

• Credit institutions
• Electronic money institutions
• Post office giro institutions
• Payment institutions

PSP can also include a natural or legal person benefiting from an exemption in accordance with Article 32 of the Payment Services Directive.

The CESOP measures have been transposed into Irish law through the insertion of a new Part 9A (Reporting obligations of certain payment service providers) into the Irish VAT Consolidation Act 2010.

Although the CESOP measures are part of the EU’s VAT package (and are included in VAT law) it is important to bear in mind that the measures are separate from any matters regarding a PSP’s status vis-à-vis VAT law generally (eg payments to or from non-taxable persons will need to be reported if all conditions of the CESOP measures are satisfied).

Key takeaway

PSPs should ensure that they are in compliance with any record keeping and reporting obligations arising out of the CESOP measures.