If you intend to start out a small business in britain and wish to import goods to the country then you should make sure you make payment for proper customs vat on imported goods so that your costs match your predictions. You possibly can surely ensure improved profit margins when your purchase and sale price are in tune with your calculations.
The hm revenue and customs department or hmrc vat department handles duties on imported services and goods in the UK, and also handles vat returns filed by vat registered traders in the country. Once your taxable sales cross 70,000 pounds in vatcontrol.com 12 months you might need to get vat registration. Thus allows you to get a vat number and generate a vat invoice for each sale made in the local market. You’ll now ought to file a vat return at the designated period and pay vat in line with the current vat rate based upon your sales.
However, before you start selling your goods or services, you might need to import them to the UK. Your goods will most probably fall under one of the 14,000 hm customs vat classifications and you will need to pay the suitable duties on those goods. In case you want to import tobacco or alcohol products then you’ll need to pay excise duties on the very same. It is thus very important to check on the appropriate classification of your goods so that you end up making payment on the exact amount of duties specified on it instead of paying more and boosting your costs or paying less and getting into trouble later on.
After you have paid all of the relevant import vat, or customs, or excise duties then you will also have to charge the right vat rates while selling those goods locally. Your products might attract the standard vat rate of 17.5% or a lower rate of 5% or even be vat exempt based on its classification. This rate will certainly vary in other EU countries and therefore you should have up-to-date knowledge on uk vat and eu vat rates while importing or exporting your goods as well as selling them locally.
Simply because it may be quite challenging for you to keep updating your knowledge on changes taking place in customs and vat rates, you should appoint a capable customs and vat agent to manage your import and sales duties. Your agent would look after all paperwork related to customs duties, check on whether your goods are classified correctly, calculate all vat figures plus file your vat returns in time. Your agent would likewise be able to help you in vat registration and offer other vat services in case your business has just been established.
If you plan to import goods into the UK or maybe in another EU country then a detailed knowledge on all vat rules, customs and excise duties, and operations on vat returns is critical for healthy business growth. One mistake you could end up earning the wrath of the customs and excise vat department and put a spanner on future vat refunds. While importing goods to your country you ought to certainly make sure you pay proper customs vat on imported goods so as to retain complete control over your costs.