Xero launches Irish VAT tool for accountants & bookkeepers

Xero has launched an Irish VAT solution for accountants and bookkeepers, bringing VAT 3 and Return of Trading Details preparation into a single workflow.

The tool lets practices prepare VAT 3 submissions and annual Return of Trading Details reports using transaction data already held in Xero, without relying on separate systems. It also generates Revenue Online Services-ready outputs for filing.

Irish accounting practices have often managed VAT compliance through a mix of software, spreadsheets and manual workarounds, particularly when dealing with reverse charges, annual reconciliations and cross-border transactions. Return of Trading Details work can be especially time-consuming because firms must review a full year of VAT data and reconcile each period before submission.

Xero's first release for the Irish market focuses on reducing manual preparation. Users can prepare, review and export VAT 3 returns, while annual Return of Trading Details submissions are compiled from the same underlying figures.

Built-in Irish VAT rates are applied from the point an invoice is raised. The tool also supports EU and reverse charge VAT, with cross-border figures assigned to the relevant fields in both the VAT 3 return and the annual Return of Trading Details.

Users can drill into the transactions behind any reported figure before filing, with supporting invoices and receipts stored alongside each entry. The software works on either a cash receipts basis or an invoice basis, reflecting the accounting methods used by different Irish businesses.

Pressure on practices

The launch comes as accounting firms face pressure to manage compliance work alongside broader advisory demands from small business clients. In Ireland, accountants often serve as a key finance contact for smaller companies without in-house finance teams.

"Accountants shouldn't have to use multiple tools just to complete their most routine compliance returns. VAT 3 and RTD are core parts of compliance in Ireland, but for too many practices the process has been too fragmented, too manual and too time-consuming," said Adam Brewer, Regional Manager, Ireland, Xero.

Brewer said time spent on compliance administration can limit firms' ability to provide planning and financial advice to clients.

"Irish accounting practices are under pressure to deliver more for clients while managing increasingly complex compliance," he said. "For many small businesses, their accountant is the closest thing they have to a finance director, but that relationship only thrives when practices have time for it. Hours spent on manual compliance are hours not spent on advice, planning and the conversations that help businesses grow. Our goal is to give accountants and bookkeepers some of that time back."

Xero also linked the launch to wider changes in the Irish market. Ireland is moving towards mandatory e-invoicing from 2028, and accounting software providers are adapting their products to fit that shift in tax and reporting administration.

Easing VAT 3 and Return of Trading Details preparation is part of that broader build-out for the country. The product is now available to accountants and bookkeepers in Ireland.

Workflow changes

The launch matters less for the filing step itself than for the work required beforehand. In many practices, staff must gather client records, review VAT treatment, enter figures into more than one system, and then reconcile annual totals for the Return of Trading Details.

By drawing figures from the same transaction base, the software aims to reduce repeated data entry and lower the risk of inconsistencies between periodic VAT returns and the annual report. That approach may appeal to firms handling large numbers of small business clients with varying VAT treatments and reporting methods.

Xero did not set out pricing in the announcement, but positioned the tool as part of its existing offering for accounting and bookkeeping firms. It said the workflow removes the need for extra tools when preparing the two core Irish VAT submissions.

"For Irish small businesses, the impact of simpler VAT compliance can go beyond the return itself. When accountants spend less time gathering, checking and re-entering information, they have more time to help clients understand cash flow, plan ahead and make better decisions. At a time when many businesses are facing rising costs and tighter margins, giving practices more time for advice can strengthen the support small businesses receive throughout the year," said Brewer.