If you intend to start a small business in the UK and wish to import goods to the country then you certainly must ensure you pay proper customs vat on imported goods so that your costs match your predictions. You possibly can surely ensure improved profits when your purchase and sale price are in tune with 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 united kingdom. As soon as your taxable sales cross 70,000 pounds in Twelve months you might need to get vat registration. This in turn will allow you to obtain a vat number and generate a vat invoice for every sale made in the regional market. You will now need to file a vat return in 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 might need to import them to the UK. Your goods will most probably fall under one of the 14,000 hm customs vat classifications and you’ll need to pay the appropriate duties on those goods. In the event you plan to import tobacco or alcohol products then you’ll need to pay excise duties on the same. Its thus very important to be sure of the appropriate classification of your goods so that you find yourself paying the exact amount of duties specified on it rather than pay more and boosting your costs or paying less and getting into trouble at a later date.
After you have paid all of the relevant import vat, or customs, or excise duties then you will also need to charge the right vat rates while selling those goods locally. Your products might attract the standard vat rate of 17.5% or a lower rate of 5% or even be vat exempt depending on its classification. This rate will definitely vary in other EU countries and therefore you ought to have up-to-date knowledge on uk vat and eu vat rates while importing or exporting your goods or even selling them locally.
Simply because it may be quite challenging that you keep updating your understanding on changes taking place in customs and vat rates, you should appoint a good customs and vat agent to manage all your import and sales duties. Your agent would look after all paperwork related to customs duties, check on whether your products are classified correctly, calculate all vat figures and also file your vat returns on time. Your agent would likewise be able to assist you in vat registration and offer other vat services if your business has just been established.
If you plan to import goods to the UK or in any other EU country then a detailed knowledge on all vat rules, customs and excise duties, and procedures on vat returns is vital for healthy business growth. One mistake you could end up earning the wrath of the customs and excise vat department and put a spanner on future vat refunds. While importing goods to your country you should certainly make sure you pay proper customs vat on imported goods so as to retain complete control of your costs.