Starting a new business venture in a vat enabled European State or country will only bear fruit should you confirm all european vat rules before importing goods into that EU State. This move
will help you to legally exploit all avenues to ensure that your cost is kept at the very least and therefore the problem of double taxation does not eat into your profits.
Several EU countries have embraced vat or vat over the past decade so that trading between such countries proceeds on a common platform. Countries such as the UK, Spain, Greece, Italy, Germany, France, Poland, Netherlands, Sweden, and Hungary, among others have adapted vat and most countries in addition have shifted to one common currency, i.e. the Euro. This move has facilitated smoother trading between these countries and if you would like to begin a business in an EU country which has changed to vat then appropriate knowledge of eu vat rules is mandatory to keep a decent leash on your own costs.
Any services or goods which you import in your country will attract customs or excise duties or even import vat, based on its classification. In order to charge vat to your customers, you’ll need to turn into a vat registered dealer, which can be done once you cross the vat threshold in taxable sales. Now you can come up with a vat invoice in your country and charge the applicable vat rates to your customers. Additionally, you will need to file regular vat returns based on the sales and purchases.
However, if you’re located in any european country that follows vat system and have imported goods to your country where vat was already paid in the original country or used services in a country where vat may be paid then you can reclaim the vat amount. You can claim vat amount on goods where vat was already paid by applying for a vat refund inside the original country. In case you or your workers have attended trade shows or paid vat on some other services overseas, you’ll be able to still file for a vat reclaim to recover the amount of vat paid.
The european vat rates various eu countries range between 15 to 25%, while special vat rates on certain goods and services vary from 1 to 6%. There are also certain products which are vat exempt. These rates can easily make a big difference in the product costs and if you can recover any tax which has previously been paid this can easily make a positive influence on your enterprise bottom-line. A professional and trusted vat agent can surely help you. You should look for an agent that only takes fees or commissions from vat amounts recovered rather than charging a flat fee.
Many countries in Europe have opted for a uniform tax system on products or services, and this is good news if you intend to start a new business in such a country. Your costing process will become simpler and you will surely have the ability to recover vat amounts that have been charged previously. However, you need to surely confirm all european vat rules before importing goods into an EU State so as to defend your fledgling business from the financial shocks.