If you’re importing goods into the UK from specific parts of the world then you’ll have to pay import vat whenever you import goods from eu special territories as well as 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 also the goods are then governed by local sales vat rules.
The hmrc has provided for 14,000 classifications of products and services which are governed by customs duties, excise duties and import vat. Most alcohol and tobacco products http://checkvatnumber.com together with certain activities like gambling are governed by excise duties while almost all other imports come under customs duties and import vat depending on the goods and the country from which they arrive.
The hmrc has specified eu special territories where import vat is going to be levied if goods or services are brought in or sent to such territories. Those 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 may also be levied when you import goods from non eu countries.
However, if you’re a vat registered trader in the United Kingdom you’ll be able to 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 have imported are sold in the local UK market. Countries such as the UK and Italy also offer special vat deferment schemes where one can get respite from import vat for approximately a month by filing out a special vat form with the hmrc and opening of a special vat deferment account with them. This move would help safeguard your cash flow.
Once you start selling your services or goods in the local market then you’ll also need to charge any local sales vat rate to your 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 hire the services of a proficient vat and customs agent. This may allow you to focus on expanding your enterprise while all relevant paperwork and payment of taxes and duties is handled in an efficient manner.
The import vat rate is exactly like sales vat rates of comparable products sold in the United Kingdom. The United Kingdom has 3 vat rate slabs. The first is the standard vat rate of 17.5% that is slated to rise to 20% from January 4, 2011. Second is the lower vat rate of 5% while the third is zero vat rate. There are also certain products or services which are totally exempt from any vat.
You ought to have sufficient knowledge on various duties and taxes applicable on imported goods to the UK to enable you to calculate the charges with an accurate basis. You should employ all legal avenues to lower your costs such as vat refunds, vat deferments, etc to enable you to lower your costs further and improve the cash flow of your respective business. You should diligently pay import vat whenever you import goods from eu special territories or from non eu countries and employ the expertise of an efficient vat agent to claim additional vat back.