If you’re importing goods into the UK from specific parts of the world then you will need to pay import vat when you import goods from eu special territories or even from non eu countries. This tax is collected by the hmrc vat department or hm revenue and customs department at the port or airport itself and the items are then subject to local sales vat rules.
The hmrc has provided for 14,000 classifications of products and services that are subject to customs duties, excise duties and import vat. Most alcohol and tobacco products together with certain activities like gambling are governed by excise duties while www.vatvalidation.com/vat almost every other imports fall under customs duties and import vat depending on the goods and the country from which they arrive.
The hmrc has specified eu special territories where import vat will be levied if services or goods are brought in or sent to such territories. They are The French Overseas Departments of Guadeloupe, The Canary Islands in Spain, The Aland Islands in Finland, French Guiana, Mount Athos and Reunion and Martinique in Greece, and The Channel Islands in the UK. This vat may also be levied when you import goods from non eu countries.
However, if you are a vat registered trader in the United Kingdom you’ll be able to make application for a vat refund when you have already paid vat on any goods in the nation of origin itself before being imported to the UK. You may also offset this vat against sales vat if the products which you’ve imported are offered in the local UK market. Countries such as the UK and Italy offer special vat deferment schemes where you can get respite from import vat for up to a month by filing out a special vat form with the hmrc and opening of a special vat deferment account with them. This move would help protect your cash flow.
When you start selling your services or goods from your market then you’ll also need to charge the local sales vat rate to your clients. You will need to make vat invoices that specifically mention vat rates as well as file regular vat returns. If you have problem in understanding various duties and taxes imposed by the hmrc then you definately should hire the services of an excellent vat and customs agent. This may allow you to focus on expanding your business while all relevant paperwork and payment of taxes and duties is handled in a efficient manner.
The import vat rates are exactly like sales vat rates of comparable products available in the UK. The United Kingdom has 3 vat rate slabs. The very first is the standard vat rate of 17.5% that is slated to rise to 20% from January 4, 2011. Second is the lower vat rate of 5% while the third is zero vat rate. There’s also certain products or services which are totally exempt from the vat.
You ought to have sufficient knowledge on various duties and taxes applicable on imported goods into the UK so that you can calculate the charges on an accurate basis. You should use all legal avenues to lower your costs such as vat refunds, vat deferments, etc so that you can reduce your costs further and improve the cash flow of your respective business. You need to diligently pay import vat when you import goods from eu special territories or from non eu countries and use the expertise of an efficient vat agent to claim additional vat back.