Starting a new business inside of a vat enabled European State or country is only going to bear fruit should 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 costs are kept at the very least and that the issue of double taxation does not eat into 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 like the UK, Spain, Greece, Italy, Germany, France, Poland, Netherlands, Sweden, and Hungary, amongst others have adapted vat and most countries have also vatvalidation.com moved to a common currency, i.e. the Euro. This move has facilitated smoother trading between these countries and if you would like to begin a business in an EU country which has changed over to vat then appropriate comprehension of eu vat rules is required for keeping a tight leash on your own costs.
Any services or goods that you import in your country will attract customs or excise duties as well as import vat, dependant on its classification. In order to charge vat to the customers, you will also need to turn into a vat registered dealer, which may 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 the sales and purchases.
However, if you’re based in any european country that follows vat system and also have imported goods to your country where vat was already paid in the original country or have used services in a country where vat has been 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 case you or your workers have attended trade events or paid vat on some other services overseas, then you can still apply for a vat reclaim to recuperate the quantity of vat paid.
The european vat rates various eu countries range from 15 to 25%, while special vat rates on certain products or services range from 1 to 6%. There are also certain goods that are vat exempt. These rates can make a huge difference in the product costs and when you are able to recover any tax that has previously been paid then this can easily make a positive impact on your enterprise bottom-line. An experienced and trusted vat agent can surely help you. You should seek out an agent that only takes fees or commissions from vat amounts recovered instead of charging a flat fee.
Many countries in Europe have chose a uniform tax system on products or services, which is great news if you intend to begin a whole new business in such a country. Your costing process becomes simpler and you will surely be able to recover vat amounts which may have 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.