If you have crossed the threshold limit or wish to become a part of the vat or value added tax system then you will need to apply for registration for vat to turn into a vat registered trader. Once you are a vat registered trader then you will be empowered to reclaim vat paid in another eu country and thereby decrease your costs as well as improve your business cash flow.
Several eu countries including the UK, Spain, Poland, Sweden, Italy, Germany, etc have moved over to vat for taxing goods and services. Vat is thus followed even while trading between member eu vatvalidation.com countries. If you have started a fresh business in the UK and also have touched ?70,000 pounds in taxable sales during the past 12 months then you can definitely make an application for vat registration with the HM Revenue and Customs or hmrc department. You can even apply before threshold limit is achieved if you sell your services or goods to mostly vat registered traders. Vat registration can be done as being an individual, partnership, company, trust, etc as deemed fit by the hmrc department.
However, as soon as you make an application for vat registration your costs could increase slightly, and when you sell your products or services locally in the UK at a retail level then you may choose to remain outside of vat if you only sell vat exempt goods. However, if you try to artificially try to separate your business activities simply to remain outside the system of vat then the hmrc vat department may not take your actions lightly if you’re discovered doing precisely the same. There are several benefits of entering the vat system since it will prevents the problem of double taxation by allowing you to definitely reclaim vat already paid on services or goods in another country too.
The entire process for registration for vat is quite simple however, if you are not sure about yourself then you definitely should simply appoint an expert vat agent to deal with all vat matters. The hmrc vat department offers several vat online services including applications for registration for vat. You are able to make an application for vat through your vat agent too provided you inform the department of your choice. As soon as you make an application for vat registration then this procedure for approving the application usually takes between 10 to 30 days. Fo the time being you can continue issuing regular invoices to your clients. However, in that period you will have to factor in applicable vat rates and re-issue those invoices issued after the application so that your clients can reclaim vat from their end.
Once your application is approved you will receive your unique vat registration number and may need to display it on all vat documents including your vat invoices, vat returns, and vat refunds. You will probably need to issue a vat invoice that separately shows all vat rates applied in the invoice along with your vat no at the top. You will have to provide a summary of all vat paid and collected within your vat returns which will need to be filed periodically as needed by the hmrc vat department. In case you have already paid vat on products or services in another eu country then you can certainly try for vat reclaim once you’re a certified vat registered trader.
Vat registration is a simple online procedure that needs to be done first if you wish to turn into a vat registered trader in the UK. You can simply fill up the web based vat registration form and submit it to the hmrc vat department whenever you make an application for registration for vat.