Your profit margins could be severely impacted if you fail to factor in important levies that play a role in the buying price of your product or service which makes it critical for that you decipher customs and excise vat duties to improve your earnings. If you wish to begin a trading or manufacturing business in a EU State then it’s vital that you comprehend the significance of various duties whenever you import and then sell your goods.
If you wish to start importing goods and services into your country then you’ll need to pay customs duties, excise duties, or import vat on those products or services dependant upon the classification to which they fall. If your business is located in the UK and you also plan to import goods from other EU States like Poland, Sweden, Germany, etc a thorough understanding of uk vat is necessary when you begin selling your goods in the local market. If your goods or services have already incurred eu vat within their home countries before you import it to the UK then you can certainly apply for vat reclaim in those countries so as to decrease your product costs and stop double taxation.
In the UK, it’s the hm customs and excise department that handles all matters related to customs and excise vat on goods and services imported and sold within the country. Most commercial products fall in one of the 14,000 classifications specified by the customs division while many tobacco and alcohol products will attract excise duties. Many products also attract import vat while being imported to the UK. Most products also attract sales vat or value added tax when they are sold locally and it is the hm revenue and customs department that will be tracking your sales. As soon as your sales go over the vat threshold limit of over £70,000 during the past 1 year then you may have to get vat registered.
Vat registration will not only allow you to charge vat to the clients in your vat invoice but additionally permit you to claim a vat refund in case you have already paid vat in the country of origin before importing it to the UK. A skilled customs, excise and vat agent or consultant should be employed to ensure that all your imports and vat returns are handled efficiently. There are several products that attract lower import duties and vat rates, while many will also be vat exempt. It is possible to surely lower your product costs by slotting them within the correct category as well as claiming vat refunds well before time limit.
Failure to pay the importance of customs and excise vat duties could prove to be fatal for your business. You won’t just end up with higher product costs but also in case you end up causing losses to the vat customs and excise department then you may be booked for fraudulently importing or selling goods or services in the united kingdom or perhaps the country of origin. You could also miss out on a real vat refund if you are not conversant with all the latest vat rules.
When operating a business, it is important to allow professionals to guide you, especially when the task involves reducing your costs legally and dealing with important gov departments. It is very important that you tie up with the efficient customs and excise vat consultant or agency that offers all import and vat services under one roof in order to improve your business bottom line.