If you intend to start out a business in the UK and want to import goods to the country then you certainly should make sure you pay proper customs vat on imported goods so your costs match your predictions. You can surely ensure improved profit margins when your purchase and sale price are usually in tune with your calculations.
The hm revenue and customs department or hmrc vat department handles duties on imported goods and services into the UK, and in addition handles vat returns filed by vat registered traders in the country. As soon as your taxable sales cross 70,000 pounds in 12 months you might have to get vat registration. Thus will allow you to obtain a vat number and generate a vat invoice for every sale made in the regional market. You’ll now ought to file a vat return in the designated period and pay vat based on the current vat rate based upon the sales.
However, before you begin selling your goods or services, you might need to import them into 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 will need to pay excise duties on the very same. Its thus extremely important to check on the appropriate classification of your goods so that you find yourself paying the exact level of duties specified on it rather than pay more and increasing your costs or paying less and having into trouble at a later date.
After you have paid all the relevant import vat, or customs, or excise duties then you will also have to charge the appropriate vat rates while selling those goods locally. Your merchandise might attract the conventional vat rate of 17.5% or perhaps a lower rate of 5% or maybe be vat exempt depending on its classification. This rate will definitely vary in other EU countries and thus you should have up-to-date knowledge on uk vat and eu vat rates while importing or exporting your goods or even selling them locally.
Simply because it might be very difficult for you to keep updating your understanding on changes happening in customs and vat rates, make sure you appoint a good customs and vat agent to manage all your import and sales duties. Your agent would look after all paperwork in connection with customs duties, check on whether your goods are classified correctly, calculate all vat figures and also file your vat returns on time. Your agent would also be able to help you in vat registration and offer other vat services in case your business recently been established.
If you plan to import goods into the UK or maybe in any other EU country then a detailed knowledge on all vat rules, customs and excise duties, and operations on vat returns is vital for healthy business growth. One mistake could result in earning the wrath of your 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 of your costs.