If you intend to start out a business in britain and wish to import goods to the country then you should make sure you make payment for proper customs vat on imported goods so your costs match your predictions. You possibly can surely ensure improved profits when your purchase and sale price are in tune
with all your calculations.
The hm revenue and customs department or hmrc vat department handles duties on imported goods and services into the UK, and also handles vat returns filed by vat registered traders in the country. Once your taxable sales cross 70,000 pounds in 12 months then you may need to get vat registration. This in turn will allow you to get a vat number and generate a vat invoice for every sale made in the regional market. You’ll now ought to file a vat return at the designated period and pay vat based on the current vat rate based upon your sales.
However, before you begin selling your goods or services, you may want to import them to the UK. Your goods will most probably fall into one of the 14,000 hm customs vat classifications and you will have to pay the appropriate duties on those goods. In the event you want to import tobacco or alcohol products then you will need to pay excise duties on the very same. Its thus extremely important to be sure of the correct classification of your goods so you end up making payment on the exact level of duties specified on it rather than pay more and increasing your costs or paying less and having into trouble at a later date.
After you have paid all of the relevant import vat, or customs, or excise duties then you’ll also have to charge the appropriate vat rates while selling those goods locally. Your merchandise might attract the standard vat rate of 17.5% or a lower rate of 5% or even be vat exempt based on its classification. This rate will definitely vary in other EU countries and therefore you should have up-to-date knowledge on uk vat and eu vat rates while importing or exporting your goods as well as selling them locally.
Since it may be very difficult for you to keep updating your understanding on changes taking place in customs and vat rates, you should appoint a good customs and vat agent to handle all your import and sales duties. Your agent would take care of all paperwork in connection with customs duties, evaluate whether your goods are classified correctly, calculate all vat figures plus file your vat returns on time. Your agent would also be able to assist you in vat registration and provide other vat services if your business recently been established.
If you are planning to import goods to the UK or in another EU country then a detailed knowledge on all vat rules, customs and excise duties, and operations on vat returns is vital for healthy business growth. One mistake you could end up earning the wrath of your customs and excise vat department and put a spanner on future vat refunds. While importing goods to your country you should certainly be sure you pay proper customs vat on imported goods in order to retain complete control of your costs.