Running a business in the UK that needs importing goods is usually stressful unless you know about vat customs rules imposed by the HM Revenue and Customs department. Learning all about these rules may benefit your business as you’re able ensure that your purchase and sales deadlines are maintained as well as your cost is kept to the minimum.
In case you import taxable goods to the UK then you will be charged import vat or customs duties. These duties have to be paid on the value of the goods and they are governed by vat rules that form part of the Vat Act of 1994. The amount of customs duty to be paid is called the ?ad valorem duty? and there are 6 methods you can use vat registration number to arrive at the amount of this duty. You will have to provide documentary proof to hmrc vat department as to why you’ve chosen a certain method for the valuation of the products which you’ve imported into the UK.
If you have imported goods to the UK originating from a eu country that has also collected vat tax from you before the goods were dispatched to the UK then you’ve effectively paid double tax on the same goods. If you are a vat registered trader in the United Kingdom then you can apply for vat reclaim to get the earlier amount back into your bank account. You will have to mention your vat number and provide your vat certificate to the country of origin whenever you apply for a vat refund. Although refund process could take between four to 8 months to materialize, your costs will certainly get lowered. You ought to employ the services of a capable vat agent that charges fees only on the volume of refunds that you receive. This move will provide a reason for your vat agent while rewarding you with many successful vat refunds.
Once you have paid vat customs on your goods and begin selling precisely the same under vat invoices then you will have to maintain detailed accounts of the level of vat paid and collected on them. You will have to mention these vat amounts during your vat returns that will have to be filed regularly based on the vat scheme which you have chosen. Remember that that any genuine mistake on your part while importing goods to the UK ought to be rectified as quickly as possible as it may be construed as evasion of customs duties and would invoke strict action including penalties from the hmrc department. Your vat agent should have complete knowledge on customs and excise rules along with eu vat and uk vat rules to ensure that there are no miscalculations while importing goods to the UK.
If you are a vat registered trader in the United Kingdom that needs to import goods into the UK then you’ll surely have to pay all applicable customs duties on the same. However, you may also claim back vat amounts paid in the nation of origin on goods and also on services that were utilized in that country. A reliable vat agent will help you decipher vat customs rules and help you to get back all excess vat previously paid while also helping smooth entry of imported goods to the UK.