If you are a vat registered trader in Britain then you would have to pay vat on most services and goods but are you aware that claiming vat back can enhance your business cash flow? If you have already paid vat once on any goods or services necessary for your company or paid vat on it even in another eu country then you can definitely make an application for a vat refund.
Most eu countries have adopted the system of vat or value added tax on movement of products and services as a way of collecting more revenue and plugging tax leaks. The UK too has moved to vat and when you operate a company in Britain then you will need to make an application for vat registration once your last Twelve month sales turnover touches ?70,000. Being a vat registered trader you will need to pay and collect vat on all purchases and sales related to your company according to the http://vatcontrol.com classification of these products or services according to 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 permit you to definitely claim vat back on any services or goods purchased for your business. This amount can be recovered even if you have paid that vat in another eu country that follows vat, provided you can show documentary proof which includes the vat invoice or vat receipt. In case you have imported goods to the UK after paying vat in the nation of origin or have attended a trade fair in a foreign eu country where vat has been charged to you then it may be claimed back as soon as you fill the required vat reclaim form.
You should 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’ll have a time frame of 9 months after the end of the year or so once you had first paid your vat on those services or goods. You can use several online vat services provided by hmrc vat including filing online claims for vat refunds. You will have to register on the hmrc website before you can fill up the mandatory online vat form for vat reclaim. The form will then be forwarded to the member eu country in which you might have paid vat initially, together with scans of vat invoices that you might need to attach to your application.
Once you get a confirmation usually within 15 days of receipt of your refund claim, it will take around 4 months for the claim to be approved from that member country before you can get your vat back. In case any additional clarification or documents are required then you definitely should expect a delay of 4 more months and hence it is essential to get it right the very first time itself. Your vat refund may be deposited in a bank account which you specify within or outside Britain. However, this amount will be in the currency of the country of origin and will have to be converted into sterling pounds before it can be transferred into your UK banking account.
Although the process to reclaim vat back is a little tedious, an efficient 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 cash flow by pumping back that double-taxed amount directly into your business.