If you plan to start out a 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 possibly can surely ensure improved profit margins if your purchase and sale price are in tune
with all your calculations.
The hm revenue and customs department or hmrc vat department handles duties on imported goods and services in the UK, and also handles vat returns filed by vat registered traders in the country. As soon as your taxable sales cross 70,000 pounds in 12 months then you may have to get vat registration. This in turn allows you to get a vat number and generate a vat invoice for each sale made in the local market. You’ll now ought to file a vat return in the designated period and pay vat in line with the current vat rate based upon your sales.
However, before you start selling your services or goods, you may want 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 have 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. It really is thus extremely important to check on the appropriate classification of your goods so you end up making payment on the exact amount of duties specified on it instead of paying more and increasing your costs or paying less and having into trouble at a later date.
Once you have paid all the relevant import vat, or customs, or excise duties then you’ll also need to charge the appropriate vat rates while selling those goods locally. Your merchandise might attract the standard vat rate of 17.5% or a lower rate of 5% or maybe be vat exempt depending on its classification. This rate will certainly 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 as well as selling them locally.
Since it might be very difficult for you to keep updating your knowledge on changes happening in customs and vat rates, you should appoint a good customs and vat agent to handle all your import and sales duties. Your agent would take care of all paperwork in connection with customs duties, check on whether your goods are classified correctly, calculate all vat figures and also file your vat returns on time. Your agent would also 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 another EU country then a detailed knowledge on all vat rules, customs and excise duties, and procedures on vat returns is critical for healthy business growth. One mistake could result in earning the wrath of the customs and excise vat department and put a spanner on future vat refunds. While importing goods into your country you should certainly make sure you pay proper customs vat on imported goods in order to retain complete control over your costs.