If you are importing goods into the UK from specific parts of the globe then you’ll need to pay import vat when you import goods from eu special territories or even 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 the items are then governed by local sales vat rules.
The hmrc has provided for 14,000 classifications of products and services that are subject to customs duties, excise duties and import vat. Most alcohol and tobacco products together with certain activities like gambling are subject to excise duties while www.vatvalidation.com/vat almost all other imports come under customs duties and import vat according to the goods and also the country from where they arrive.
The hmrc has specified eu special territories where import vat is going to be levied if goods or services are brought in or sent 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 whenever 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 in case you have already paid vat on any goods in the country of origin itself before being imported to the UK. You may also offset this vat against sales vat when the goods that you’ve imported are offered in the local UK market. Countries such as the UK and Italy offer special vat deferment schemes where you can get relief from import vat for up to 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 protect your cash flow.
Once you start selling your services or goods in the local 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 enable you to concentrate on expanding your enterprise while all relevant paperwork and payment of taxes and duties is handled in a efficient manner.
The import vat rate is exactly like sales vat rates of similar products available in the UK. The UK has 3 vat rate slabs. The very first is the standard vat rate of 17.5% that is slated to rise to 20% from January 4, 2011. Second is the lower vat rate of 5% whilst the third is zero vat rate. There are also certain goods and services which are totally exempt from any vat.
You ought to have sufficient knowledge on various duties and taxes applicable on imported goods to the UK so that you can calculate the charges with an accurate basis. You should employ all legal avenues to lower your costs such as vat refunds, vat deferments, etc so that you can reduce your costs further and improve the cash flow of your business. You need to diligently pay import vat whenever you import goods from eu special territories or from non eu countries and use the expertise of a competent vat agent to claim additional vat back.