In case you have crossed the threshold limit or want to become a part of the vat or value added tax system then you’ll need to apply for registration for vat to turn into a vat registered trader. When you finally are a vat registered trader you will then be empowered to reclaim vat paid in another eu country and thereby lower your costs as well as improve your business cash flow.
Several eu countries like the UK, Spain, Poland, Sweden, Italy, Germany, etc have moved over to vat for taxing products or services. Vat is thus followed whilst trading between member eu countries. If you have started a fresh business in the UK and have touched ?70,000 pounds in taxable sales in the past https://vatregistrationnumber.com 12 months then you can definitely make an application for vat registration with the HM Revenue and Customs or hmrc department. You may also apply before threshold limit is achieved if you sell your goods or services to mostly vat registered traders. Vat registration can be done as an individual, partnership, company, trust, etc as deemed fit by the hmrc department.
However, as soon as you make an application for vat registration then your costs could increase slightly, and when you sell your goods and services locally in the United Kingdom at the retail level then you could opt to remain outside of vat should you only sell vat exempt goods. However, if you try to artificially make an effort to separate your enterprise activities only to remain outside the system of vat then this hmrc vat department might not take your actions lightly if you’re discovered doing the same. There are several benefits of entering the vat system as it will avoid the problem of double taxation by permitting you to reclaim vat already paid on goods or services overseas too.
The whole process for registration for vat is pretty simple but if you aren’t sure about yourself then you should simply appoint a professional vat agent to handle all vat matters. The hmrc vat department offers several vat online services including applications for registration for vat. You can make an application for vat using your vat agent too provided you inform the department of your choosing. Once you apply for vat registration then the procedure for approving your application usually takes between 10 to 30 days. Until then you can continue issuing regular invoices to your clients. However, in that period you will have to factor in applicable vat rates and re-issue those invoices issued after your application so that your clients can reclaim vat from other end.
Once your application is approved you will receive your unique vat registration number and can need to display it on all vat documents as well as your vat invoices, vat returns, and vat refunds. You will also have to issue a vat invoice that separately shows all vat rates applied in that invoice together with your vat no at the very top. You will need to provide a breakdown of all vat paid and collected in your vat returns that will have to be filed periodically as required by the hmrc vat department. If you have already paid vat on products or services in another eu country then you can certainly try for vat reclaim once you are a certified vat registered trader.
Vat registration is a simple online procedure that needs to be done first if you wish to turn into a vat registered trader in the United Kingdom. You can easily fill up the online vat registration form and submit it to your hmrc vat department whenever you make an application for registration for vat.