If you have crossed the threshold limit or want to be a part of the vat or value added tax system then you will need to apply for registration for vat to turn into a vat registered trader Http://www.vatcheck.com. When you finally are a vat registered trader then you will be empowered to reclaim vat paid in another eu country and thereby decrease your costs and also improve your business cash flow.
Several eu countries including the UK, Spain, Poland, Sweden, Italy, Germany, etc have moved over to vat for taxing goods and services. Vat is thus followed whilst trading between member eu countries. In case you have started a fresh business in the United Kingdom and have touched ?70,000 pounds in taxable sales during the past 1 year then you can definitely make an application for vat registration with the HM Revenue and Customs or hmrc department. You can even apply before threshold limit is achieved if you sell your services or goods to mostly vat registered traders. Vat registration can be achieved as an individual, partnership, company, trust, etc as deemed fit by the hmrc department.
However, once you make an application for vat registration your costs could increase slightly, and if you sell your products or services locally in the United Kingdom at a retail level then you could choose to remain outside of vat should you only sell vat exempt goods. However, if you try to artificially make an effort to separate your business activities simply to remain outside the system of vat then the hmrc vat department may not take your actions lightly if you’re discovered doing precisely the same. There are many advantages of entering the vat system as it will prevents the problem of double taxation by allowing you to reclaim vat already paid on services or goods overseas too.
The entire process for registration for vat is quite simple but if you aren’t sure about yourself then you should simply appoint a professional vat agent to deal with all vat matters. The hmrc vat department offers several vat online services including applications for registration for vat. You can apply for vat through 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 typically takes between 10 to 30 days. Until then you can keep issuing regular invoices to your clients. However, during that period you will have to take into account applicable vat rates and re-issue those invoices issued after the application so that your clients can reclaim vat from their end.
Once your application is eligible you will receive your distinct vat registration number and can have to display it on all vat documents including your vat invoices, vat returns, and vat refunds. You will also need 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 have to provide a summary of all vat paid and collected within your vat returns that will have to be filed periodically as required by the hmrc vat department. In case you have already paid vat on goods and services in another eu country then you can certainly apply for vat reclaim once you’re an official vat registered trader.
Vat registration is a straightforward online process that needs to be done first if you want to turn into a vat registered trader in the UK. You can easily fill up the web based vat registration form and submit it to the hmrc vat department when you make an application for registration for vat.