If you are importing goods to the UK from specific regions of the world then you’ll 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 on the port or airport itself and the goods are then subject to local sales vat rules.
The hmrc has provided for 14,000 classifications of goods and services that are subject to customs duties, excise duties and import vat. Most alcohol and cigarettes and tobacco products http://checkvatnumber.com along with certain activities such as gambling are governed by excise duties while almost all other imports come under customs duties and import vat depending on the goods and also the country from which they arrive.
The hmrc has specified eu special territories where import vat is going to be levied if goods or services are brought in or sent to such territories. Those 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 also the Channel Islands in the UK. This vat will also be levied whenever you import goods from non eu countries.
However, if you’re a vat registered trader in the UK then you can make application for a vat refund when you have already paid vat on any goods in the country of origin itself before being imported into the UK. You may also offset this vat against sales vat when the products which you’ve imported are sold from our UK market. Countries like the UK and Italy offer special vat deferment schemes where one can get respite from import vat for approximately a month by filing out a unique vat form with the hmrc and opening of a special vat deferment account with them. This move would help safeguard your cash flow.
When you start selling your services or goods from your market then you will also need to charge any 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 a proficient vat and customs agent. This will enable you to concentrate on expanding your business while all relevant paperwork and payment of taxes and duties is handled in an efficient manner.
The import vat rates are the same as sales vat rates of comparable products available in the UK. The UK has 3 vat rate slabs. The very first is the standard vat rate of 17.5% which is slated to rise to 20% from January 4, 2011. The second is the lower vat rate of 5% while the third is zero vat rate. There’s also certain goods and 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 costs with an accurate basis. You should employ all legal avenues to lower your costs like vat refunds, vat deferments, etc to enable you to lower your costs further and improve the income of your respective business. You need to diligently pay import vat whenever 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.