Starting a new business venture inside of a vat enabled European State or country is only going to bear fruit if you confirm all european vat rules before importing goods into that EU State. This move will allow you to legally exploit all avenues to ensure that your costs are kept at a minimum and that the issue of double taxation doesn’t eat in your profits.
Several EU countries have embraced vat or value added tax in the last decade to ensure that trading between such countries proceeds on a common platform. Countries such as the UK, Spain, Greece, Italy, Germany, France, Poland, Netherlands, Sweden, and Hungary, among others have adapted vat and most countries in addition have moved to vat check a common currency, i.e. the Euro. This move has facilitated smoother trading between these countries and if you want to begin a business in a EU country which has changed over to vat then appropriate comprehension of eu vat rules is mandatory to keep a decent leash on your own costs.
Any services or goods which you import in your country will attract customs or excise duties or even import vat, based on its classification. In order to charge vat to your customers, you’ll need to turn into a vat registered dealer, which can be done as soon as you cross the vat threshold in taxable sales. Now you can make a vat invoice inside your country and charge the applicable vat rates to your customers. Additionally, you will need to file regular vat returns based on your sales and purchases.
However, if you are located in any european country that follows vat system and also have imported goods to your country where vat has already been paid in the original country or used services in a country where vat may be paid then you can reclaim the vat amount. You are able to claim vat amount on goods where vat has already been paid by applying for a vat refund in the original country. In the event you or your employees have attended trade events or paid vat on some other services in another country, you’ll be able to still file for a vat reclaim to recover the quantity of vat paid.
The european vat rates various eu countries range between 15 to 25%, while special vat rates on certain goods and services range from 1 to 6%. There’s also certain goods that are vat exempt. These rates can easily make a huge difference in the product costs and if you are able to recover any tax that has previously been paid this can make a positive influence on your business bottom-line. An experienced and trusted vat agent can surely help you out. You should look for a broker that only takes fees or commissions from vat amounts recovered instead of charging a set fee.
Many countries in Europe have opted for a uniform tax system on goods and services, and this is great news if you intend to start a new business in such a country. Your costing process becomes simpler and you will surely have the ability to recover vat amounts that have already been charged previously. However, you need to surely confirm all european vat rules before importing goods into an EU State in order to defend your fledgling business from the financial shocks.