If you intend to start out a small business in the UK and wish to import goods to the country then you must ensure you make payment for proper customs vat on imported goods so 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. As soon as your taxable sales cross 70,000 pounds in 12 months then you may need to get vat registration. This in turn allows you to obtain a vat number and generate a vat invoice for every sale made in the regional market. You will now need to file a vat return at the designated period and pay vat based on the current vat rate based on the sales.
However, before you start selling your goods or services, you might need to import them into the UK. Your goods will most probably fall into one of the 14,000 hm customs vat classifications and you’ll have to pay the appropriate duties on those goods. In the event you want to import tobacco or alcohol products then you’ll have to pay excise duties on the very same. It is thus extremely important to be sure of the correct classification of your goods so you find yourself paying the exact amount of duties specified on it rather than pay more and increasing your costs or paying less and having into trouble at a later date.
Once you have paid all the relevant import vat, or customs, or excise duties then you’ll also need to charge the right vat rates while selling those goods locally. Your products might attract the standard vat rate of 17.5% or perhaps a lower rate of 5% or maybe be vat exempt based 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 taking place in customs and vat rates, you should appoint a capable customs and vat agent to handle all your import and sales duties. Your agent would take care of all paperwork related to customs duties, evaluate whether your goods are classified correctly, calculate all vat figures and also file your vat returns in time. Your agent would likewise be able to assist you in vat registration and offer other vat services if your business has just been established.
If you plan to import goods into the UK or in any other EU country then a detailed knowledge on all vat rules, customs and excise duties, and procedures on vat returns is vital for healthy business growth. One mistake you could end up earning the wrath of your customs and excise vat department and put a spanner on future vat refunds. While importing goods into your country you ought to certainly be sure you pay proper customs vat on imported goods in order to retain complete control of your costs.