Prompt Payment Procedures
Prompt Payment Procedures.
The Department is committed to making every effort to pay its suppliers promptly. In this regard suppliers can help by ensuring that they provide correct invoices, accurate bank account details and by ensuring that their Tax Clearance status with the Irish Revenue Commissioners is up to date.
(In the case of all public sector contracts of a value of €10,000 (inclusive of VAT) or more within any 12-month period, the contractor (and agent or sub-contractor as appropriate) will be required to produce either a valid tax clearance certificate or a C2 certificate. This is a mandatory requirement. Full details on tax clearance procedures may be found on the Revenue Commissioners website)
Prompt Payment of Accounts Legislation.
Payment of invoices by the Department is governed by the Prompt Payment of Accounts Act, 1997 as amended by the European Communities (Late Payment in Commercial Transactions) Regulations 2002. The legislation provides for the payment of interest on valid invoices which are unpaid after 30 days from the date of receipt. Interest is calculated in respect of the period starting on the date after the due date and ending on the date when payment is made.
Payment of interest cannot be waived by the supplier and must be included with the amount payable for the goods or services without demand for its payment being made by the supplier.
From the 1st July 2010, the late payment interest rate is 8% per annum (that is based on the ECB rate of 1% plus the margin of 7%). That rate equates to a daily rate of 0.022%. Penalty interest due for late payments should be calculated on a daily basis. The ECB rate can be checked on the Central Bank and Financial Services Authority of Ireland website or on the European Central Bank website.
The Department has ten working days to return an incorrect invoice which must be accompanied by a written statement identifying the alleged defects that prevent payment being made. Following acceptance by the Department of the corrected invoice, the Department will endeavour to issue payment within 15 days.
The legislation does not oblige payment to be made to a supplier who has failed or refused to comply with a request to produce a tax clearance certificate and it expressly extends the statutory time limit for payment where there are delays in furnishing a tax clearance certificate. Also the Act does not affect the deduction of withholding tax from any payment to a supplier.
New 15-Day Payment Requirement, June 2009
The Government introduced a further non-statutory requirement in June 2009 to reduce the payment period by Central Government Departments to their suppliers from 30 to 15 days. Every effort, consistent with proper financial procedures, is being made to ensure that all suppliers are paid within this timeframe. The links below show the Department's performance with regard to the 15 day payment requirement since its introduction.
Period: 1 January 2010 to 31 March 2010 (PDF
Period : 1 April 2010 to 30 June 2010 (PDF 91kb)
Period: 1 July 2010 to 30 September 2010 (PDF 29kb)
Period: 1 October 2010 to 31 December 2010 (PDF 163kb)
Period: 1 January 2011 to 31 March 2011 (PDF
Period: 1 April 2011 to 30 June 2011 (PDF 164kb)
Period: 1 July to 30 September 2011 (PDF 163kb)
Period: 1 October 2011 to 31 December 2011 (PDF 163kb)