If you are importing goods into the UK from specific parts of the world then you will have to pay import vat when you import goods from eu special territories as well as from non eu countries. This tax is collected by the hmrc vat department or the hm revenue and customs department at 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 products and services which are subject to customs duties, excise duties and import vat. Most alcohol and tobacco products along with certain activities such as gambling are subject to excise duties while almost every other imports fall under customs duties and import vat according to the goods and the country from where they arrive.
The hmrc has specified eu special territories where import vat will be levied if goods or services are brought in or sent to such territories. Those are the http://vatcheck.com/vat 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 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 can also offset this vat against sales vat if the products which you’ve imported are offered in the local UK market. Countries like the UK and Italy offer special vat deferment schemes where you can get respite from import vat for approximately one month by filing out a special vat form with the hmrc and opening of an special vat deferment account with them. This move would help protect your cash flow.
When you start selling your services or goods in the local market then you will also have to charge any local sales vat rate to your clients. You will have to make vat invoices that specifically mention vat rates and also file regular vat returns. If you have problem in understanding various duties and taxes imposed by the hmrc then you definately should engage the services of a proficient vat and customs agent. This will enable you to concentrate on expanding your enterprise while all relevant paperwork and payment of taxes and duties is handled in an 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 normal vat rate of 17.5% that is slated to go up 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 goods and services which are totally exempt from any 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 on an accurate basis. You should employ all legal avenues to lower your costs like vat refunds, vat deferments, etc to enable you to reduce your costs further and enhance 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.