Most European countries have adopted vat or value added tax as a way of taxing products or services and you should certainly learn about exempt vat category in european states. Most countries exempt vat from certain goods or services that may pose a financial burden for the public or to needy people.
It is necessary that you learn all about vat rates including vat exemption in case you intend to start a business in any European country. This move will help you slot your items correctly in the designated vat classifications, which in turn can help improve the bottom-line of your business. Once you start your own manufacturing or trading business and import services or goods into your own country then you will need to pay customs and excise duties based on the type of imports. When you cross the vat threshold limit set up by your country http://vatvalidation.com/vat you will need to get vat registered so that you can start charging vat by way of a vat invoice. The threshold limit varies within eu states and in the UK the limit of £70,000 is achieved when your taxable sales cross that amount during the past 12 months.
However, before you start charging vat to the clients you additionally need to find out about existing vat rates throughout your home country and other countries. Thus, information about eu vat as well as uk vat is important, especially if your business is located in Britain. Most countries have 3 different categories of vat. Nearly all services and products fall under the regular vat rate that varies from 15-25%. There are certain services and products that fall under reduced vat rates that cover anything from 1-6%. The final vat rate is a zero vat rate where no vat is charged by the seller although any vat, if previously paid on that product or service can be refunded using a vat reclaim.
There are also certain products or services that usually come under the purview of social services or obligations and in most cases qualify as exempt vat. Although there might some element of hidden vat inside these services or goods, buyers or sellers cannot claim any vat back on them. In most countries services such as insurance, banking, medical including hospitals, education, and social security, among others have exemption from vat.
Moreover certain products like postage stamps, medical equipments, and even lotteries or gambling services are exempt from vat. If your range of activities or imports falls under any of these sections then you would be exempt from paying or collecting any vat even though you might also not be able to request a vat refund if vat has already been paid for the same in another eu country.
For those who have trouble locating out vat rates in various countries including your own or have trouble in filing your vat returns then you definitely should hire a specialist vat agent that’s also conversant in the latest customs, excise and vat rules. This should help you to understand information about exempt vat category in european states, which inturn could also prove to be good for your business.