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 vatcontrol.com/vat department. Learning about these rules may benefit your organization as you can make sure 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 need to be paid on the valuation of the products and they are governed by vat rules that form part of the Vat Act of 1994. How much customs duty to be paid is called the ?ad valorem duty? and then there are 6 methods that can be used to reach the amount of this duty. You will have to provide documentary proof to hmrc vat department as to the reasons you’ve chosen a particular way of the valuation of the goods that you have imported into the UK.
In case you have imported goods into the UK 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 the amount tax on the very same goods. If you are a vat registered trader in the UK then you can make an application for vat reclaim so as to get the earlier amount back to your account. You will have to mention your vat number and give your vat certificate to the country of origin whenever you file for a vat refund. Although refund process could take between four to eight months to materialize, your costs will definitely get lowered. You should employ the services of a capable vat agent that charges fees only on the amount of refunds that you get. This move will give you a reason to your vat agent while rewarding you with many successful vat refunds.
Once you have paid vat customs on the goods and start selling precisely the same under vat invoices then you’ll need to maintain detailed accounts of the amount of vat paid and collected on them. You’ll 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. You should remember that any genuine mistake on your part while importing goods into the UK ought to be rectified as soon as possible since it could be construed as evasion of customs duties and would invoke strict action including penalties from the hmrc department. Your vat agent must have complete knowledge on customs and excise rules as well as eu vat and uk vat rules to ensure that there are no miscalculations while importing goods into the UK.
If you’re a vat registered trader in the UK that must import goods into the UK then you’ll surely need to pay all applicable customs duties on the same. However, you can also reclaim vat amounts paid in the country of origin on goods and even on services that were utilised in that country. A competent 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 into the UK.