If you are a vat registered trader in the UK you would then need to pay vat on most goods and services but did you know that claiming vat back can improve your business cash flow? In case you have already paid vat once on any services or goods required for your business or paid vat on it even in another eu country then you can definitely make 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 way of collecting more revenue and plugging tax leaks. Great Britain too has moved to vat and when you operate a company in Britain then you’ll have to apply for vat registration when your last 12 month sales turnover touches ?70,000 checkvatnumber.com. 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 those goods and services as per the HM Revenue and Customs or hmrc vat department.
However, in order to avoid double taxation on such goods and services, the hmrc department has produced vat rules that will permit you to definitely claim vat back on any services or goods purchased for your business. This amount may be recovered even though you have paid that vat in another eu country that follows vat, provided you can show documentary proof which includes the vat invoice or vat receipt visit your url. 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 is charged to you then these can be claimed back after you fill up the necessary vat reclaim form.
You need to hire an excellent vat agent with complete understanding of uk vat and eu vat rules so that your vat refund claim is passed in the shortest time possible. You will have a time frame of 9 months after the end of the calendar year once you had first paid your vat on those goods or services. You may use several online vat services offered by hmrc vat including filing online claims for vat refunds. You will need to register on the hmrc website before you fill up the mandatory online vat form for vat reclaim. The form is then sent 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.
Once you receive a confirmation usually within 15 days of receipt of the refund claim, it will require around 4 months for your 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 definitely should expect a delay of 4 more months and hence it is essential to have it right the first time itself. Your vat refund may be deposited in a banking account that you specify within or outside the UK. However, this amount will be in the currency of the country of origin and will need to be changed into sterling pounds before it can be transferred into your UK banking account.
Although the process to reclaim vat back is a bit tedious, an efficient vat agent can apply for vat refunds on your behalf and notify you on the status of your applications. The reality is that claiming vat back can indeed improve your business income by pumping back that double-taxed amount directly into your company.