Operating a business in the UK that needs importing goods is usually stressful unless you know all about vat customs rules imposed by the HM Revenue and Customs https://vatcontrol.com/vat department. Learning all about these rules may benefit your organization as you’re able ensure that your purchase and sales deadlines are maintained as well as your costs are kept to the minimum.
In case you import taxable goods into the UK then you will be charged import vat or customs duties. These duties have to be paid on the valuation of the products and they are subject to 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 you can use to arrive at 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 products which you’ve imported to the UK.
In case you have imported goods to the UK originating from a eu country that has also collected vat tax from you prior to goods were dispatched to the UK then you have effectively paid double tax on the same goods. If you are a vat registered trader in the UK you’ll be able to make an application for vat reclaim so as to get the previous amount back to your account. You will have to mention your vat number and provide your vat certificate to the country of origin when you apply for a vat refund. Although refund process might take between four to 8 months to materialize, your costs will definitely get lowered. You ought to employ the expertise of a capable vat agent that charges fees only on the volume of refunds that you receive. This move will provide a reason for your vat agent while rewarding you with many successful vat refunds.
Once you’ve paid vat customs on the goods and begin selling the same under vat invoices then you will need to maintain detailed accounts of the amount of vat paid and collected built in. You will have to mention these vat amounts in your vat returns which will need to be filed regularly based on the vat scheme that you have chosen. You should remember that any genuine mistake by you while importing goods to the UK ought to be rectified as quickly as possible since it may 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 aren’t any miscalculations while importing goods into the UK.
If you’re a vat registered trader in the UK that must import goods to the UK then you’ll surely need to pay all applicable customs duties on the same. However, you may also reclaim vat amounts paid in the nation of origin on goods and also on services that were utilized in that country. A competent vat agent can help you decipher vat customs rules and help you get back all excess vat previously paid while also helping smooth entry of imported goods into the UK.