If you intend to start out a small business in britain and wish to import goods into the country then you certainly should make sure you pay proper customs vat on imported goods so your costs satisfy your predictions. You 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 services and goods in the UK, and in addition handles vat returns filed by vat registered traders in the united kingdom. Once your taxable sales cross 70,000 pounds in Twelve months you might have to get vat registration. Thus allows you to get a vat number and generate a vat invoice for each sale made in the regional market. You will 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 might need to import them into the UK. Your goods will in all probability fall into one of the 14,000 hm customs vat classifications and you’ll need to pay the appropriate duties on those goods. In case you want to import tobacco or alcohol products then you’ll have to pay excise duties on the same. It really is thus very important to check on the appropriate classification of your goods so that you find yourself making payment on the exact level of duties specified on it instead of paying more and increasing your costs or paying less and having into trouble later on.
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 conventional vat rate of 17.5% or a reduced rate of 5% or maybe be vat exempt based on its classification. This rate will definitely vary in other EU countries and thus 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 happening in customs and vat rates, make sure you appoint a capable customs and vat agent to manage your import and sales duties. Your agent would look after all paperwork related to 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 help you in vat registration and provide other vat services in case your business recently been established.
If you are planning to import goods to the UK or maybe in another EU country 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 your customs and excise vat department and put a spanner on future vat refunds. While importing goods into your country you should certainly be sure you pay proper customs vat on imported goods so as to retain complete control over your costs.