If you’re a vat registered trader in the UK then you would need 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 required for your company or paid vat on it in another eu country then you can definitely submit an application for a vat refund.
Most eu countries have adopted the system of vat or value added tax on movement of products and services as a means of collecting more revenue and plugging tax leaks. Great Britain too has shifted to vat and if you run a company in Britain then you will need to apply for vat registration once 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 in connection with your business according to the classification of these products or services according to the HM Revenue and Customs or hmrc vat department.
However, to prevent double taxation on such goods and services, the hmrc department has established vat rules that will allow you to claim vat back on any services or goods purchased for the business vatcontrol.com/vat. 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 country of origin or have attended a trade fair inside a foreign eu country where vat has been charged for you then it may be claimed back as soon as you fill the necessary vat reclaim form.
You should hire an excellent vat agent with complete understanding of uk vat and eu vat rules so your vat refund claim is passed within the shortest time possible. You will have a time limit of 9 months after the end of the year or so once you had first paid your vat on those services or goods important source. You can use several online vat services offered by hmrc vat including filing online claims for vat refunds. You will have to register at the hmrc website before you fill up the required online vat form for vat reclaim. The form is then forwarded to the member eu country in which you might have paid vat initially, together 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 additional clarification or documents are needed then you definitely should expect a delay of 4 more months and hence it is essential to have it right the very first time itself. Your vat refund can be deposited in any bank account that you specify within or outside Britain. However, this amount will be in the currency of the nation of origin and will need to be changed into sterling pounds prior to it being transferred to your UK banking account.
Although the process to reclaim vat back is a little tedious, an efficient vat agent can apply for vat refunds on your behalf and inform you on the status of your applications. The fact is that claiming vat back can indeed improve your business income by pumping back that double-taxed amount directly into your company.