Xero has launched an Irish VAT solution that automates VAT 3 and annual Return of Trading Details submissions directly from transaction data, removing a long-standing manual reconciliation burden for accountants and bookkeepers, a launch that matters broadly because it targets one of the most time-consuming routine compliance tasks Irish practices handle, and matters specifically to accountancy professionals because it positions Xero users ahead of Ireland's mandatory eInvoicing regime, which begins phasing in for large corporates from November 2028.

Xero is a New Zealand-founded cloud accounting software provider used by small businesses and their accountants worldwide, with dedicated Irish payroll, invoicing and VAT compliance tools built specifically for practices operating under Revenue's reporting requirements.

Adam Brewer, Xero's regional manager for Ireland, said VAT 3 and RTD compliance had become "too fragmented, too manual and too time-consuming" for many practices, particularly the annual RTD process that requires reconciling a full year of data period by period.

That manual burden sits against a much larger regulatory shift already under way. Ireland's VAT Modernisation programme will require large corporates to issue structured e-invoices for domestic transactions from November 2028, with all VAT-registered businesses required to receive them by the same date, extending to all VAT-registered businesses issuing them from November 2029 and full EU-wide compliance by July 2030.

The programme aims to close Ireland's own VAT gap, estimated at 1.7 billion euros, as part of a wider EU effort against a bloc-wide gap of roughly 89.3 billion euros lost annually to fraud and administrative error.

Automating VAT 3 and RTD now gives practices cleaner, more consistent transaction data ahead of that bigger transition, rather than trying to retrofit structured reporting onto manual processes once the 2028 deadline approaches.

The move also intensifies competition between accounting platforms building compliance automation as Irish reporting requirements tighten, with rival Sage separately investing in embedded payment and reconciliation tools aimed at the same practices.

For the sector, automated VAT compliance is becoming a baseline expectation rather than a differentiator, as Ireland's reporting regime moves steadily toward real-time, structured data over the coming years.

Source: TechBuzz Ireland / Revenue.ie / VATfaqs