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Claiming vat back can enhance your business income


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If you’re a vat registered trader in Britain you would then have to pay vat on most services and goods but did you know that claiming vat back can enhance your business income? If you have already paid vat once on any goods or services necessary for your business or paid vat on it in another eu country then you can certainly submit an application for a vat refund.

Most eu countries have adopted the system of vat or value added tax on movement of goods and services as a means of collecting more revenue and plugging tax leaks. Great Britain too has moved to vat and when you operate vat verification a company in the UK then you will need to make an application for vat registration when your last Twelve month sales turnover touches ?70,000. As a vat registered trader you will need to pay and collect vat on all purchases and sales related to your company depending on the classification of these products or services as per the HM Revenue and Customs or hmrc vat department.

However, in order to avoid double taxation on such services and goods, the hmrc department has produced vat rules that will permit you to claim vat back on any goods or services purchased for the business. This amount may be recovered even if you have paid that vat in another eu country that follows vat, provided you are able to show documentary proof which includes the vat invoice or vat receipt. In case you have imported goods to the UK after paying vat in the nation of origin or have attended a trade fair in a foreign eu country where vat has been charged to you then these can be claimed back as soon as you fill the required vat reclaim form.

You should hire a proficient vat agent with complete knowledge of uk vat and eu vat rules so that your vat refund claim is passed within the shortest time possible. You’ll have a time frame of 9 months following the end of the year or so once you had first paid your vat on those goods or services. You may use several online vat services provided by hmrc vat including filing online claims for vat refunds. You will have to register on the hmrc website before you fill the mandatory online vat form for vat reclaim. The form is then forwarded to the member eu country where you may have paid vat initially, along with scans of vat invoices that you might have to affix to your application.

As soon as you receive a confirmation usually within 15 days of receipt of the refund claim, it will require around 4 months for the claim to be approved from that member country before you can get your vat back. In case any other clarification or documents are required then you should expect a delay of four more months and hence it is essential to get it right the very first time itself. Your vat refund may be deposited in any banking account that you specify within or outside the UK. However, this amount will be in the currency of the nation of origin and will need to be changed into sterling pounds before it can be transferred to your UK bank account.

Even though the process to reclaim vat back is a bit tedious, an efficient vat agent can apply for vat refunds on your behalf and inform you about the status of your applications. The fact is that claiming vat back can certainly enhance your business income by pumping back that double-taxed amount back into your business.