Starting a new business venture in 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 help you to legally exploit all avenues to make sure that your cost is kept at the very least and that the problem of double taxation does not eat in your profits.
Several EU countries have embraced vat or value added tax in the last decade so that trading between such countries proceeds on a common platform. Countries like the UK, Spain, Greece, Italy, Germany, France, Poland, Netherlands, Sweden, and Hungary, amongst others have adapted vat and many countries have also vatvalidation.com shifted to a common currency, i.e. the Euro. This move has facilitated smoother trading between these countries if you would like to begin a business in an EU country that has changed over to vat then appropriate knowledge of eu vat rules is required to keep a decent leash on your costs.
Any services or goods that you import into your country will attract customs or excise duties or even import vat, dependant on its classification. To be able to charge vat to the customers, you’ll have to turn into a vat registered dealer, which may be done as soon as you cross the vat threshold in taxable sales. You can now come up with 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 have imported goods to your country where vat has already been paid from the original country or have used services in a country where vat has been paid you’ll be able to 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 inside the original country. In case you or your workers have attended trade events or paid vat on some other services in another country, you’ll be able to still apply for a vat reclaim to recuperate the quantity of vat paid.
The european vat rates various eu countries range between 15 to 25%, while special vat rates on certain products or services vary from 1 to 6%. There’s also certain goods that are vat exempt. These rates can easily make a huge difference in your product costs and when you are able to recover any tax which has previously been paid then this can easily make a positive influence on your business bottom-line. An experienced and trusted vat agent can surely help you out. You should seek out an agent that only takes fees or commissions from vat amounts recovered instead of charging a set fee.
Many countries in Europe have chose a uniform tax system on goods and services, which is great news if you plan to start a new business in such a country. Your costing process will become simpler and you will surely have the ability to recover vat amounts which may have already been charged previously. However, you need to surely confirm all european vat rules before importing goods into an EU State so as to defend your fledgling business from any financial shocks.