Starting a new business venture inside of a vat enabled European State or country is only going to bear fruit if 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 costs are kept at a minimum and therefore the issue of double taxation does not eat in your profits.
Several EU countries have embraced vat or vat in the last 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 many countries in addition have vatvalidation moved to one common currency, i.e. the Euro. This move has facilitated smoother trading between these countries if you want to begin a business in an EU country which has changed over to vat then appropriate comprehension of eu vat rules is required to keep a decent leash on your own costs.
Any services or goods that you import into your country will attract customs or excise duties or even import vat, based on its classification. To be able 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. You can now make a vat invoice in your country and charge the applicable vat rates to the customers. You will also have to file regular vat returns determined by the sales and purchases.
However, if you’re located in any european country that follows vat system and also have imported goods into 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 in the original country. In the event you or your employees have attended trade events or paid vat on some other services in another country, then you can still file for a vat reclaim to recover the quantity of vat paid.
The european vat rates various eu countries range between 15 to 25%, while special vat rates on certain products or services range from 1 to 6%. There’s also certain products which are vat exempt. These rates can easily make a huge difference in the product costs and when you are able to recover any tax which has already been paid then this can easily make a positive influence on your enterprise bottom-line. An experienced and trusted vat agent can surely help you out. Make sure you seek out a broker that only takes fees or commissions from vat amounts recovered rather than charging a set fee.
Many countries in Europe have chose a uniform tax system on goods and services, which is great news if you intend to begin a new business in that country. Your costing process will become simpler and you will surely be able to recover vat amounts which may have been charged previously. However, you should surely confirm all european vat rules before importing goods into an EU State so as to defend your fledgling business from the financial shocks.