Starting a new business in a vat enabled European State or country is only going to bear fruit if you confirm all european vat rules before importing goods into that EU State. This move will allow you to legally exploit all avenues to ensure that your costs are kept at the very least and that the issue of double taxation doesn’t eat into your profits.
Several EU countries have embraced vat or vat over the past decade to ensure that trading between such countries proceeds on a common platform. Countries like the UK, Spain, Greece, Italy, Germany, France, Poland, Netherlands, Sweden, and Hungary, among others have adapted vat and many countries in addition have shifted to vatcheck.com/vat a common currency, i.e. the Euro. This move has facilitated smoother trading between these countries if you would like to start a business in a EU country which has changed to vat then appropriate comprehension of eu vat rules is required to keep a tight leash on your costs.
Any services or goods which you import in your country will attract customs or excise duties or even import vat, based on its classification. In order to charge vat to the customers, you will also have to turn into a vat registered dealer, which can be done as soon as you cross the vat threshold in taxable sales. You can now make a vat invoice inside your country and charge the applicable vat rates to your customers. You will also need to file regular vat returns determined by your sales and purchases.
However, if you’re located in any european country that follows vat system and also have imported goods to your country where vat was already paid from the original country or have used services in a country where vat may be paid then you can reclaim the vat amount. You are able to claim vat amount on goods where vat has already been paid by applying for a vat refund in the original country. In case you or your employees have attended trade events or paid vat on any other services in another country, then you can still apply for a vat reclaim to recuperate the quantity of vat paid.
The european vat rates various eu countries range from 15 to 25%, while special vat rates on certain goods and services range from 1 to 6%. There are also certain products which are vat exempt. These rates can easily make a big difference in the product costs and when you are able to recover any tax that has previously been paid this can make a positive impact on your enterprise bottom-line. A professional and trusted vat agent can surely help you out. Make sure you look for a broker that only takes fees or commissions from vat amounts recovered instead of charging a set fee.
Many countries in Europe have opted for a uniform tax system on products or services, which is great news if you intend to begin a new business in that country. Your costing process becomes simpler and you will surely be able to recover vat amounts that have already been charged previously. However, you need to surely confirm all european vat rules before importing goods into an EU State so as to defend your fledgling business from any financial shocks.