Open up a business in a eu vat state to retain control over your costs

If you wish to start a new business in any European country you then should open up a small business inside a eu vat state to retain control of your costs. Vat, in principle avoids the pitfalls of double taxation and also should you end up paying vat more often than once then you can certainly also apply for a vat refund to recoup your money.

Through the years many Countries in europe including Hungary, Germany, Greece, Spain, Italy, UK, Sweden, Poland, etc have shifted to vat or value added tax as a way of collecting tax in a very transparent manner while also plugging tax leaks. The method has become largely successful and also this common way of charging tax on services and goods has also facilitated smooth imports and exports between countries that form part of the european vat system.

You can begin a new business in any eu vat state or country and start importing goods into your own country. You’ll however pay the suitable customs or excise duties and may also need to pay import vat according to the classification of the goods. However, once your taxable sales cross the vat threshold limit set by the particular eu country you might need vat registration to turn into a vat registered trader or dealer. This will likely clear the path to get your own vat no, charge appropriate vat rates in your vat invoice and also present regular vat returns to the tax authorities. You’ll now truly be a part of your eu vat system.

However, there are several benefits of remaining in the europa vat system. In case you have imported goods from a member vat country where vat was already charged you’ll be able to simply complete the necessary vat form to claim a vat refund. In case you or your staff have paid vat during trade shows or on some other services that attract vat then such vat rates too can be claimed back from that country provided all documentary proof is shown. As you may not in a position to learn all about the latest eu vat rules it will be better when you allow a specialist vat agent to reclaim vat in your stead.

Your vat agent also needs to file your vat returns in time and also make sure that your vat refund applications are handled well within the time limit. Most countries in Europe that have adopted vat normally have 3 vat rates. The first is the standard vat rate of about 15 to 25% on many goods. The second is the lower vat rate of about 1 to 6% on specific goods whilst the third is goods that are vat exempt. If you’ve paid vat in a foreign country then this is certainly large amounts, and recovering this amount can easily lower costing and give a much-needed financial injection into your new business.

Vat is truly an efficient solution to ensure that tax leakage is reduced in a seamless manner. You also should go for starting a business in a vat friendly european country while also importing goods or services from a member country which also follows vat. By setting up a business in a eu vat state you are able to certainly retain control over your costs while plugging your revenue leaks on services or goods where vat was already charged.