Ensure you pay proper customs vat on imported goods
If you intend to start a small business in britain and want to import goods to the country then you should make sure you make payment for proper customs vat on imported goods so your costs match 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 into the UK, and in addition handles vat returns filed by vat registered traders in the united kingdom. As soon as your taxable sales cross 70,000 pounds in 12 months then you may 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’ll now ought to file a vat return at the designated period and pay vat in line with the current vat rate based upon your sales.
However, before you start selling your goods or services, you might need to import them into the UK. Your goods will most probably fall into one of the 14,000 hm customs vat classifications and you’ll have to pay the suitable 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 extremely important to check on the correct classification of your goods so you end up paying the exact amount of duties specified on it instead of paying more and boosting your costs or paying less and getting into trouble at a later date.
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 products might attract the standard vat rate of 17.5% or perhaps a lower rate of 5% or maybe be vat exempt depending on its classification. This rate will certainly 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 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 good customs and vat agent to manage all your import and sales duties. Your agent would take care of all paperwork related to customs duties, evaluate whether your products are classified correctly, calculate all vat figures plus file your vat returns in time. Your agent would also be able to assist you in vat registration and provide other vat services if your business recently been established.
If you are planning to import goods to the UK or maybe in any other 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 the 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 of your costs.
