If you intend to start a small business in the UK and want to import goods into the country then you must ensure you pay proper customs vat on imported goods so that your costs satisfy your predictions. You can surely ensure improved profit margins if your purchase and sale price are usually in tune with all your calculations.
The hm revenue and customs department or hmrc vat department handles duties on imported services and goods into the UK, and in addition handles vat returns filed by vat registered traders in the country. As soon as your taxable sales cross 70,000 pounds in Twelve months then you may need to get vat registration. This in turn allows you to obtain a vat number and generate a vat invoice for every sale made in the local market. You will now ought to file a vat return at the designated period and pay vat in line with the current vat rate based on the 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 into on the list of 14,000 hm customs vat classifications and you will need to pay the suitable duties on those goods. In case you plan to import tobacco or alcohol products then you’ll need to pay excise duties on the very same. Its thus very important to be sure of the correct classification of your goods so that you find yourself paying the exact level of duties specified on it instead of paying more and increasing your costs or paying less and getting into trouble at a later date.
Once 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 conventional vat rate of 17.5% or perhaps a lower rate of 5% or maybe be vat exempt depending on its classification. This rate will definitely vary in other EU countries and thus 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.
Since it might be quite challenging that you keep updating your understanding on changes happening in customs and vat rates, make sure you appoint a capable customs and vat agent to handle 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 and also file your vat returns in time. Your agent would likewise be able to assist you in vat registration and provide other vat services in case your business recently been established.
If you are planning to import goods into the UK or maybe in another 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 should certainly make sure you pay proper customs vat on imported goods so as to retain complete control of your costs.