Ensure you pay proper customs vat on imported goods
If you intend to start a business in britain and want to import goods to the country then you certainly should make sure you pay proper customs vat on imported goods so that your costs match your predictions. You can surely ensure improved profit margins if your purchase and sale price are usually in tune
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The hm revenue and customs department or hmrc vat department handles duties on imported services and goods into the UK, and in addition 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 need to get vat registration. Thus allows you to obtain a vat number and generate a vat invoice for every sale made in the regional market. You’ll now ought to file a vat return in 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 have to pay the suitable duties on those goods. In the event you want to import tobacco or alcohol products then you’ll need to pay excise duties on the same. Its thus extremely important to be sure of the appropriate classification of your goods so that you find yourself making payment on the exact amount of duties specified on it instead of paying more and boosting 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 will also have 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 even be vat exempt depending on its classification. This rate will certainly 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 as well as selling them locally.
Simply because it might be quite challenging for you to keep updating your understanding on changes happening in customs and vat rates, make sure you appoint a good customs and vat agent to manage all your import and sales duties. Your agent would look after all paperwork in connection with customs duties, check on whether your products are classified correctly, calculate all vat figures and also file your vat returns on time. Your agent would also be able to assist you in vat registration and provide other vat services in case your business has just been established.
If you are planning to import goods into the UK or maybe in any other EU country a detailed knowledge on all vat rules, customs and excise duties, and operations on vat returns is vital 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 ought to certainly make sure you pay proper customs vat on imported goods so as to retain complete control over your costs.