If you have already paid VAT inside a foreign eu country and have to pay for the same again in your own country then you can reclaim vat to lower the burden of double check vat number taxation. The whole procedure can be completed online, especially if your vat registered business is located in the United Kingdom in which the HM revenue and customs or hmrc department offers several vat online services such as the vat refund scheme which makes reclaiming vat an easy process.
In case you have purchased goods from another vat enabled country in the European Union such as Spain, Sweden, Hungary, Poland, Italy, Germany, etc where you do not have a vat registered business and have already paid vat in the country of origin then you can certainly and must claim that vat back. This will not only lower product cost but will also allow for vital funds to flow back to your business. Although the vat reclaiming process typically takes between four to 8 months to finish, you can easily appoint a vat agent that is a specialist in eu vat and uk vat refund rules. This should help you to concentrate on your business while your agent tries to reclaim vat on your behalf by using the online vat refund scheme.
Before you post your first claim for vat, you will need to be a vat registered trader in the UK and will need to sign up for vat refund with the hmrc. You’ll have maximum of 9 months following the end of a year or so for making your vat refund application. Since you can simply fill out the web based vat form to reclaim any previously paid vat, you won’t have to fill out and dispatch any paperwork but should attach scanned copies of vat paid invoices for claims more than a stipulated amount. Some countries might also insist upon taking a look at original invoices that you might need to dispatch to get a successful refund. Again, your vat agent can assist you to complete all necessary formalities.
Many eu countries have their own version of a vat invoice and also have different vat rates for various goods and services. For example, Poland requires its vat registered traders to issue a faktura invoice or vat invoice. However, most eu countries provide some form of vat refunds to prevent the problem of double taxation on goods and services. You simply can’t deduct the vat refund amount in your routine vat returns but will instead have to use the vat refund scheme for the very same. In case you have made a vat reclaim in a eu country then you’ll usually receive the refund amount in their currency. You can either transfer the refund amount to an account in that country or directly arrange for the money to generally be received within your UK banking account by giving them the necessary details including your bank account number.
In case you constantly need to import services or goods into the UK where vat was already paid you then should register for the vat refund scheme offered by the hmrc vat department. Once you successfully reclaim vat then you can accurately price your products and services while receiving a much needed financial injection in your business.