By Bébhinn Egan, 15th June 2026
In August 2025, the Irish Revenue published a Variable Direct Debit (VDD) system for Value Added Tax payments on the Revenue Online System (ROS). The new system replaces the Fixed Direct Debit (FDD) option. Under the new system, Revenue obtains permission from businesses to debit their bank account for any balance outstanding on the due date. This ensures that businesses pay the correct amount of tax due at the correct time. Revenue will collect these variable direct debit payments on or around the third last working day of the month. Businesses cannot select a different deduction date.
Under the old Fixed Direct Debit system, businesses agreed with Revenue that a fixed monthly payment amount be debited from their bank account towards their VAT liability during the year. At the end of the VAT period, any difference between the fixed payment and the VAT due had to be reconciled.
How VDD Works in Practice
- Once a VDD mandate is set up in ROS, Revenue will automatically debit the exact tax amount due on, or around, the third last working day of the month.
- This system ensures that taxpayers pay the correct amount at the correct time, reducing any potential interest charges arising as a result of late or incorrect payments.
- This system allows for more accurate and up-to-date visibility of VAT liabilities.
- This new system provides immediate access to VAT credits once they arise.
- Taxpayers can amend or cancel a VDD at any time through ROS.
If you have any questions or would like to discuss this new system further, we at Company Bureau would be delighted to assist you. Contact our team of experts online here!
Disclaimer: This article is for guidance purposes only. It does not constitute legal or professional advice. No liability is accepted by Company Bureau for any action taken or not taken in reliance on the information set out in this article. Professional or legal advice should be obtained before taking or refraining from any action as a result of this article. Any and all information is subject to change.
