Financial services (such as brokering) are a zero VAT business, we cannot charge VAT for our activities, we do however, pay VAT on all of our supplies and in one respect that makes financial services good for the Revenue Commissioners, it’s a one way street.

Equally, it makes everything more expensive for a financial services company, but we won’t be expecting any sympathy on that!

However, what happens when that financial service is for a person in difficulty? A guideline given by the Revenue Commissioners to a debt management company in Dublin has lead to the interpretation that ‘Debt Management’ is subject to VAT.

What that means is this:- If you get into trouble servicing your debt and you hire a professional service to help you negotiate with lenders and to arrive at settlements on interest and principle amounts due then you will have to pay VAT on the fee applicable by the company that is helping you to get out of trouble. Thus the service becomes 21.5% more expensive to people who can already ill afford to pay out more every month.

If the state are serious about trying to help people in need then one of the core foundations should be that of making all financial services VAT FREE, why are some at the zero rate and others are not? Indeed, it seems that when you have money you deal with zero VAT companies but if you get into trouble it suddenly becomes applicable making a difficult situation even harder should you enlist the help of a debt mediation expert.
‘The happiness or unhappiness of a man does not depend on the amount of property or gold he owns. Happiness or misery are in one’s soul. A wise man feels at home in every country. The whole universe is the home of a noble soul.’

– Democritus.