How to reclaim VAT on Google Adwords

Google Adwords is based in Ireland and under EU VAT law they charge 21% Irish VAT (higher than UK VAT which is currently 17.5%).

However, if you use Adwords for business purposes you can reclaim the Irish VAT. Many accountants are unaware of this fact.

HRBS are specialists in online businesses.

One of the first questions we ask our new clients is “Are you registered as a business with Google Adwords”? Those replying “No” are extremely pleased to find out that they can reclaim this VAT and rather upset with their former accountants for not telling them.

What is business advertising?

Adwords is used to advertise many things, very little of which is private advertising. In fact the overwhelming majority of advertisers are using AdWords for business purposes. If you seek to gain an economic advantage by promoting goods or services on the Google advertising network, then you ARE using your account for business purposes. This includes affiliate marketeers whether sole traders, partnerships or limited companies.

Many HRBS clients have received refunds of £’000s.

If you have had a Google Adwords account for some time, quickly calculate the Irish VAT you have already paid and follow our instructions to get your refund.

How to claim.

Its very, very, very easy.

1. Log in to your Adwords account
2. Go to the “My Account” tab
3. Choose “Billing Preferences”
4. Click [Edit] next to VAT information
5. At Advertising Purpose chose yes for “I use Google AdWords for business purposes”
6. Click save changes

In due course Google will verify your details and issue a refund.

The Bad News

The refund is taxable (but not VATable), this is because you have previously claimed the Irish VAT-inclusive payment in your accounts and so this refund is effectively a refund of previously paid advertising costs. If your accountant doesn’t understand this, point them to our tips.hrbs.biz website or better still, become a HRBS client. Click here for a free, no-obligation fixed fee quotation.