If you’re importing goods to the UK from specific regions of the globe then you will have to pay import vat whenever you import goods from eu special territories or even from non eu countries. This tax is collected by the hmrc vat department or hm revenue and customs department on the port or airport itself and the items are then governed by local sales vat rules.
The hmrc has provided for 14,000 classifications of goods and services which are governed by customs duties, excise duties and import vat. Most alcohol and cigarettes and tobacco products www.vatcheck.com together with certain activities such as gambling are governed by excise duties while almost every other imports come under customs duties and import vat according to the goods and also the country from where they arrive.
The hmrc has specified eu special territories where import vat will be levied if services or goods are brought in or delivered to such territories. They are The French Overseas Departments of Guadeloupe, The Canary Islands in Spain, The Aland Islands in Finland, French Guiana, Mount Athos and Reunion and Martinique in Greece, and The Channel Islands in the UK. This vat will also be levied whenever you import goods from non eu countries.
However, if you are a vat registered trader in the UK then you can make application for a vat refund in case you have already paid vat on any goods in the country of origin itself before being imported to the UK. You can also offset this vat against sales vat if the goods that you’ve imported are offered in the local UK market. Countries such as the UK and Italy offer special vat deferment schemes where one can get relief from import vat for approximately a month by filing out a special vat form with the hmrc and opening of an special vat deferment account with them. This move would help safeguard your cash flow.
Once you start selling your services or goods from your market then you’ll also have to charge any local sales vat rate to the clients. You will need to make vat invoices that specifically mention vat rates and also file regular vat returns. For those who have problem in understanding various duties and taxes imposed by the hmrc then you definately should engage the services of an excellent vat and customs agent. This may enable you to concentrate on expanding your enterprise while all relevant paperwork and payment of taxes and duties is handled in an efficient manner.
The import vat rates are the same as sales vat rates of similar products sold in the United Kingdom. The UK has 3 vat rate slabs. The first is the standard vat rate of 17.5% that is slated to go up to 20% from January 4, 2011. Second is the reduced vat rate of 5% whilst the third is zero vat rate. There are also certain products or services which are totally exempt from the vat.
You ought to have sufficient knowledge on various duties and taxes applicable on imported goods to the UK so that you can calculate the charges on an accurate basis. You should employ all legal avenues to reduce your costs like vat refunds, vat deferments, etc to enable you to reduce your costs further and enhance the cash flow of your respective business. You should diligently pay import vat when you import goods from eu special territories or from non eu countries and use the expertise of a competent vat agent to claim additional vat back.