If you’re a vat registered trader in the UK you would then have to pay vat on many goods and services but are you aware that claiming vat back can enhance your business cash flow? If you have already paid vat once on any services or goods necessary for your company or paid vat on it in another eu country then you can certainly submit an application for a vat refund.
Most eu countries have adopted the system of vat or value added tax on movement of goods and services as a means of collecting more revenue and plugging tax leaks. Great Britain too has moved to vat and if you run a business in the UK then you will need to make an application for vat registration when your last 12 month sales turnover touches ?70,000. As a vat registered trader you will need to pay and collect vat on all purchases and sales in connection with your company according to the classification of those products or services as per the HM Revenue and Customs or hmrc vat department.
However, in order to avoid double taxation on such goods and services, the hmrc department has established vat rules that will allow you to definitely claim vat back on any services or goods purchased for your business vatcontrol.com/vat. This amount can be recovered even if you have paid that vat in another eu country that follows vat, provided you are able to show documentary proof that includes the vat invoice or vat receipt. If you have imported goods to the UK after paying vat in the country of origin or have attended a trade fair inside a foreign eu country where vat is charged for you then it may be claimed back as soon as you fill the required vat reclaim form.
You need to hire a proficient vat agent with complete knowledge of uk vat and eu vat rules so your vat refund claim is passed in the shortest time possible. You will have a time frame of 9 months following the end of the year or so after you had first paid your vat on those services or goods get more information. You can use several online vat services offered by hmrc vat including filing online claims for vat refunds. You will have to register on the hmrc website before you can fill the mandatory online vat form for vat reclaim. The form is then sent to the member eu country where you may have paid vat initially, together with scans of vat invoices that you might need to attach to the application.
Once you receive a confirmation usually within 15 days of receipt of the refund claim, it will take around 4 months for your claim to be approved from that member country before you can get your vat back. In the event any other clarification or documents are needed then you definitely should expect a delay of 4 more months and therefore it is essential to get it right the very first time itself. Your vat refund can be deposited in a bank account which you specify within or outside the UK. However, this amount will be in the currency of the country of origin and will have to be changed into sterling pounds prior to it being transferred to your UK bank account.
Even though the process to reclaim vat back is a bit tedious, a competent vat agent can apply for vat refunds as your representative and inform you on the status of the applications. The fact is that claiming vat back can certainly enhance your business income by pumping back that double-taxed amount directly into your company.