So, as I was going through our receipts recently, seeing what was expenses, a restaurant bill from a lovely little restaurant in Mayo that we visited caught my attention. I have uploaded it here but removed the name of the restaurant. (Don’t worry though, we did email them to let them know what we noticed, for which they were very grateful.)
So, the receipt in question featured a total of €93.00 of our spend was categorised at 23% on the receipt itself however we only spent €46 for Water and Wine, one of our delicious desserts was categorised at 0% VAT - that’s the equivalent of saying it had no calories either! So, when we calculated the actual applicable VAT for our meal, the correct VAT due to Revenue was €20.73, yet the establishment recorded it as €23.10 – an overpayment of €2.37 to revenue.
Imagine if this was repeated 20 times a night, five days a week – that’s a weekly overpayment of €237 to Revenue or a reduction of over €12,000 in profits for that restaurant in a year.
This incident underscores the critical importance of accurate data input in the operational framework of hospitality businesses. Against the backdrop of the recent VAT rate reversion from 9% to 13.5% – meticulousness is paramount for businesses striving to safeguard their margins and their futures.
For clarity and as we just love to ensure the continued sustainability of the Irish Hospitality industry, the current VAT rates for Irish hospitality stand as follows:
This little receipt and error serves as a stark reminder for businesses to prioritize precision in handling VAT always make sure you have your categorisations correct - if not it could cost you your business.
#IrishHospitality #VATManagement #BusinessInsights