If you’re importing goods into the UK from specific parts of the world then you will need to pay import vat whenever you import goods from eu special territories as well as 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 also the goods are then subject to local sales vat rules.
The hmrc has provided for 14,000 classifications of goods and services which are governed by customs duties, excise duties and import vat. Most alcohol and tobacco products www.checkvatnumber.com 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 also the country from which they arrive.
The hmrc has specified eu special territories where import vat will be levied if services or goods are brought in or delivered to such territories. They 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 The Channel Islands in the United Kingdom. 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 apply for a vat refund when you have already paid vat on any goods in the country of origin itself before being imported to the UK. You can also offset this vat against sales vat when the goods that you have 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 special vat form with the hmrc and opening of an special vat deferment account with them. This move would help safeguard your cash flow.
When you start selling your goods or services from your market then you’ll also have to charge the local sales vat rate to the 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 engage the services of a proficient vat and customs agent. This will allow 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 exactly like sales vat rates of comparable products available in the UK. The UK has 3 vat rate slabs. The very first is the normal vat rate of 17.5% which 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 that are totally exempt from the vat.
You should have sufficient knowledge on various duties and taxes applicable on imported goods into the UK to enable you to calculate the charges with an accurate basis. You should use all legal avenues to reduce your costs such as vat refunds, vat deferments, etc to enable you to lower your costs further and enhance 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 services of an efficient vat agent to claim additional vat back.