Ensure you pay proper customs vat on imported goods

 

If you intend to start a small business in britain and wish to import goods to the country then you certainly should make sure you make payment for proper customs vat on imported goods so your costs satisfy your predictions. You can surely ensure improved profit margins when your purchase and sale price are usually in tune with all your calculations.

The hm revenue and customs department or hmrc vat department handles duties on imported services and goods into the UK, and also handles vat returns filed by vat registered traders in the country. As soon as your taxable sales cross 70,000 pounds in Twelve months then you may need to get vat registration. This in turn allows you to obtain a vat number and generate a vat invoice for every sale made in the regional market. You will now ought to file a vat return at the designated period and pay vat in line with the current vat rate based on your sales.

However, before you start selling your goods or services, you may want to import them to the UK. Your goods will most probably fall into on the list of 14,000 hm customs vat classifications and you’ll need to pay the appropriate duties on those goods. In case you want to import tobacco or alcohol products then you will need to pay excise duties on the very same. It is thus extremely important to be sure of the correct classification of your goods so you find yourself paying the exact level of duties specified on it rather than pay more and increasing your costs or paying less and getting into trouble later on.

Once you have paid all the relevant import vat, or customs, or excise duties then you will also have to charge the appropriate vat rates while selling those goods locally. Your merchandise might attract the standard vat rate of 17.5% or perhaps a reduced rate of 5% or even be vat exempt based on its classification. This rate will definitely vary in other EU countries and therefore you ought to have up-to-date knowledge on uk vat and eu vat rates while importing or exporting your goods as well as selling them locally.

 

Since it might be very difficult that you keep updating your knowledge on changes taking place in customs and vat rates, you should appoint a good customs and vat agent to manage all your import and sales duties. Your agent would look after all paperwork related to customs duties, check on whether your goods are classified correctly, calculate all vat figures plus file your vat returns in time. Your agent would also be able to help you in vat registration and offer other vat services if your business has just been established.

If you plan to import goods to the UK or in another EU country a detailed knowledge on all vat rules, customs and excise duties, and procedures on vat returns is critical for healthy business growth. One mistake you could end up earning the wrath of your customs and excise vat department and put a spanner on future vat refunds. While importing goods into your country you ought to certainly make sure you pay proper customs vat on imported goods so as to retain complete control over your costs.