If you plan to start out a business in the UK and wish to import goods to the country then you certainly must ensure you make payment for proper customs vat on imported goods so that your costs match your predictions. You can surely ensure improved profits when your purchase and sale price are usually in tune with your calculations.
The hm revenue and customs department or hmrc vat department handles duties on imported services and goods 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 Twelve months you might 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 regional market. You will now ought to file a vat return in the designated period and pay vat based on the current vat rate based upon your sales.
However, before you begin selling your services or goods, you may want 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 need to pay the suitable duties on those goods. In case you plan to import tobacco or alcohol products then you will need to pay excise duties on the very same. It is thus extremely important to check on the appropriate classification of your goods so that you end up paying the exact level of duties specified on it instead of paying more and boosting your costs or paying less and getting into trouble later on.
Once 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 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 may be very difficult 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 handle all your import and sales duties. Your agent would take care of all paperwork related to customs duties, evaluate whether your goods are classified correctly, calculate all vat figures and also file your vat returns in time. Your agent would also be able to help you in vat registration and offer other vat services if your business has just been established.
If you are planning to import goods into 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 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 make sure you pay proper customs vat on imported goods so as to retain complete control over your costs.