If you plan to start a small business in the UK and wish to import goods into the country then you should make sure you make payment for proper customs vat on imported goods so that your costs satisfy your predictions. You can surely ensure improved profits if 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 services and goods in 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. Thus allows you to get a vat number and generate a vat invoice for every sale made in the regional market. You’ll now need to file a vat return at the designated period and pay vat based on the current vat rate based upon the sales.
However, before you begin selling your goods or services, you might need to import them into 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 want to import tobacco or alcohol products then you’ll have to pay excise duties on the same. Its thus extremely important to check on the correct classification of your goods so you end up paying the exact level of duties specified on it instead of paying more and increasing your costs or paying less and having into trouble at a later date.
After you have paid all the relevant import vat, or customs, or excise duties then you will also have to charge the right vat rates while selling those goods locally. Your merchandise might attract the standard vat rate of 17.5% or perhaps 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 as well as selling them locally.
Since it may be quite challenging for you to keep updating your knowledge on changes happening in customs and vat rates, make sure you appoint a good customs and vat agent to handle your import and sales duties. Your agent would look after all paperwork in connection with customs duties, evaluate whether your products are classified correctly, calculate all vat figures and also file your vat returns in time. Your agent would likewise be able to assist you in vat registration and offer other vat services in case your business recently been established.
If you are planning to import goods to the UK or in any other EU country 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 the customs and excise vat department and put a spanner on future vat refunds. While importing goods to your country you ought to certainly make sure you pay proper customs vat on imported goods so as to retain complete control of your costs.