Your profit margins could be severely impacted if you don’t take into account important levies that contribute to the buying price of your product or service and this can make it crucial for that you decipher customs and excise vat duties to improve your revenue. If you want to start a trading or manufacturing business in a EU State then it is imperative that you comprehend the significance of various duties when you import and then sell your goods.
If you wish to start importing services and goods into your country then you will have to pay customs duties, excise duties, or import vat on those products or services depending on the classification to which they fall. If your business is located in the UK and you also intend to import goods from other EU States like Poland, Sweden, Germany, etc a thorough understanding of uk vat is necessary when you start selling your goods in the local market. If your services or goods have already incurred eu vat in their home countries before you import it to the UK then you can apply for vat reclaim in those countries so as to lower your product costs and prevent double taxation.
In the UK, it’s the hm customs and excise department that handles all matters related to customs and excise vat on goods and services imported and sold inside the country. Most commercial products fall within one of the 14,000 classifications specified by the customs division while most tobacco and alcohol products will attract excise duties. Many products also attract import vat while being imported https://vatvalidation.com into the UK. Most products also attract sales vat or value added tax when they are sold locally and it’s also the hm revenue and customs department that will be tracking your sales. Once your sales cross over the vat threshold limit of over £70,000 in the past 12 months then you may have to get vat registered.
Vat registration will not only allow you to charge vat to your clients as part of your vat invoice but additionally allow you to claim a vat refund if you have already paid vat in the country of origin before importing it to the UK. An experienced customs, excise and vat agent or consultant ought to be employed to ensure that all of your imports and vat returns are handled efficiently. There are several products that attract lower import duties and vat rates, while some are also vat exempt. You can surely lower your product costs by slotting them within the correct category as well as claiming vat refunds well before time limit.
Failure to cover the importance of customs and excise vat duties could prove to generally be fatal for your business. You won’t just end up having higher product costs but in case you end up causing losses to the vat customs and excise department then you may be booked for fraudulently importing or selling goods or services in the united kingdom or perhaps the land of origin. You might miss out on a real vat refund if you aren’t conversant with all the latest vat rules.
When running a business, it is essential to allow professionals to guide you, specially when the task involves reducing your costs legally and dealing with important gov departments. It is vital that you just tie up with the efficient customs and excise vat consultant or agency which provides all import and vat services under one roof so as to improve your business net profit.