If you intend to start a small business in the UK and want to import goods into 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 into the UK, and also handles vat returns filed by vat registered traders in the united kingdom. As soon as your taxable sales cross 70,000 pounds in 12 months then you may have to get vat registration. Thus will allow you to get a vat number and generate a vat invoice for each sale made in the local 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 begin selling your services or goods, you may want to import them into the UK. Your goods will in all probability fall into one of the 14,000 hm customs vat classifications and you’ll vat check need to pay the appropriate 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. It is thus extremely important to check on the correct classification of your goods so you end up making payment on the exact amount of duties specified on it instead of paying more and increasing your costs or paying less and getting into trouble at a later date.
After you have paid all the relevant import vat, or customs, or excise duties then you’ll also have to charge the right vat rates while selling those goods locally. Your merchandise might attract the conventional vat rate of 17.5% or a reduced rate of 5% or maybe be vat exempt depending on its classification. This rate will certainly vary in other EU countries and thus you ought to have up-to-date knowledge on uk vat and eu vat rates while importing or exporting your goods or even selling them locally.
Since it might be very difficult for you to keep updating your understanding on changes taking place in customs and vat rates, make sure you appoint a good customs and vat agent to handle 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 provide other vat services if your business recently been established.
If you are planning to import goods to the UK or in any other 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 into your country you should certainly make sure you pay proper customs vat on imported goods in order to retain complete control over your costs.