If you do your own books, you have one disadvantage that has nothing to do with how careful you are. Nobody checks your work before Revenue sees it.
An accountant doing your year end runs a set of checks so routine they barely think about them. Does the bank agree with the paperwork? Is anything in here twice? Is there spending we have no invoice for? None of that is exotic. It's just that when you self-file, nobody does it, and the errors it catches are the ones that quietly cost you money or fail an audit.
This post is about those checks: what they are, why each one matters in Irish terms, and how to run them yourself.
First, what you're actually producing
Worth being clear about the outputs, because the checks exist to protect them.
A sole trader or small company filing their own returns in Ireland produces four things over a year:
- The records themselves. Every invoice, receipt and credit note, kept for six years. Revenue can ask for them.
- VAT3 returns. Bi-monthly for most, giving T1 (VAT on your sales), T2 (VAT on your purchases) and the balance as T3 (you owe) or T4 (you're owed).
- The Return of Trading Details (RTD). Annual, splitting sales and purchases by VAT rate rather than by total.
- Form 11. Your income tax return, which starts from trading profit: turnover excluding VAT, less allowable expenses.
Every one of those is built from the same pile of documents. An error in the pile flows into all four.
Check 1: spending with no document behind it
This is the one that costs you money, and it's invisible unless you go looking.
Money left your bank account. You have no invoice or receipt for it. That means two things:
- You can't claim the expense, so your profit is overstated and you pay income tax on money you actually spent.
- You can't reclaim the VAT, so you hand Revenue money you were entitled to keep.
A builder paying €6,800 to a merchant with no invoice filed loses the deduction and roughly €1,270 of reclaimable VAT at 23%. On one transaction.
How to run it. Take your bank statement for the period and go down the debits. For each one, find the document. What's left over is the list. Most of it will be legitimate non-business items such as a loan repayment, wages, or a VAT payment to Revenue, and those never have an invoice. What matters is the remainder: real business spending you have no paperwork for.
Do this while you can still ask the supplier for a copy. Six months later, it's a lost deduction.
Check 2: the same document twice
Duplicates inflate your expenses and overstate the VAT you reclaim. Both are errors in Revenue's favour to correct and yours to be embarrassed by.
They happen for boring reasons. An invoice arrives by email and again by post, so it's scanned twice. Or a supplier reissues one with a new date and the old copy is still in the pile.
How to run it. Sort your list by supplier, then by amount. Duplicates surface immediately: same supplier, same date, same amount, twice. Check the invoice number before deleting either, because two genuinely different invoices from one supplier on one day for the same amount is unusual but not impossible.
One trap. A credit note reversing an invoice looks almost identical: same supplier, same date, often the same amount. It isn't a duplicate. It's the correction. Deleting it would leave the original invoice claimed in full.
Check 3: an invoice and a receipt for the same purchase
This one is specific to how self-filers actually work, and it's easy to miss.
You buy materials. The merchant gives you a till receipt at the counter and posts the invoice at month end. You scan both, because you're being thorough. Now the purchase is in your books twice, once as a receipt and once as an invoice, and the VAT is reclaimed twice.
Scanning more isn't the problem. Not noticing they're the same purchase is.
How to run it. Look for a supplier where you hold both an invoice and a receipt for the same amount within a month or so of each other. Keep the invoice, because it's the VAT document, and take the receipt out of the figures. Don't delete it. Mark it as not counted, so you can still show it if asked.
Check 4: does the statement balance against itself?
A quick one, and it catches extraction and transcription errors before they reach a return.
Take the statement's opening balance, subtract everything that went out, add everything that came in. You should land exactly on the printed closing balance.
If you don't, something is wrong with the statement data, not your accounts. A transaction missed, a figure misread, a page not scanned. Fix that before you use any figure derived from it.
This matters more than it sounds, because a missing page of a bank statement doesn't announce itself. The statement looks complete. It's only the arithmetic that tells you it isn't.
Check 5: the Irish specifics that only apply to you
Some checks only exist because of how Irish VAT works. These are the ones a UK-oriented tool or a generic spreadsheet won't prompt you about.
Reverse charge on construction (RCT). If you're a subcontractor invoicing a principal contractor, your invoice carries 0% VAT and the principal accounts for it. If you're the principal, you self-account. A subcontractor invoice arriving with 13.5% VAT charged on it is wrong, and if you reclaim that VAT, Revenue will disallow it. Check that every subcontractor invoice in your pile carries the reverse charge treatment it should.
Non-deductible VAT. VAT on petrol, entertainment and most passenger cars is not reclaimable, whatever the invoice says. A tool that sums all VAT on purchases into T2 will overstate your reclaim unless you take these out.
The 13.5% and 23% split. Construction services are 13.5%. Materials and plant hire are 23%. The RTD wants them separated, so if your records only hold a total VAT figure per document you'll be reconstructing the split at year end from memory.
Periods that straddle. A quarter isn't a VAT period. Irish VAT is bi-monthly for most filers (Jan to Feb, Mar to Apr, and so on), so a document dated 1 March belongs to a different return than one dated 28 February. A range that doesn't line up with a full VAT period will produce figures that don't match any return you can file.
What none of this tells you
Being honest about the limits, because the checks are only half the job.
- They don't compute your tax. Trading profit is where the paperwork ends. Income tax, PRSI and USC depend on your personal circumstances, including credits, spouse and other income, and no amount of invoice checking produces them.
- They don't cover what isn't on an invoice. Capital allowances, drawings, opening and closing stock, apportioning motor expenses between business and private use. None of that comes from documents.
- They don't file anything. Returns are filed on ROS. Deadlines and thresholds change, so check them on revenue.ie rather than trusting anything you read in a blog post, including this one.
The habit that makes all of this cheap
Every check above is easy in the month it happens and painful ten months later. The supplier still has your invoice on file in March. The reason for that €400 payment is still in your head this week.
If you take one thing from this: reconcile your bank against your documents monthly, not annually. Not because monthly is virtuous, but because the missing invoice is still recoverable and the odd payment is still explicable. Do it once a year and every gap has hardened into a lost deduction.
This is general information about record-keeping, not tax advice. Your circumstances determine your obligations, so check with Revenue or an accountant before you file.