If you want to start a new business in a European country then you should open a business inside a eu vat state to retain control over your costs. Vat, in principle avoids the pitfalls of double taxation and even should you end up paying vat more often than once then you can also obtain a vat refund to recover your money.
Through the years many Countries in europe including Hungary, Germany, Greece, Spain, Italy, UK, Sweden, Poland, etc have shifted to vat or value added tax as being a method of collecting tax in a transparent manner while also plugging tax leaks. The method has been largely successful and also this common method of charging tax on goods and services has also facilitated smooth imports and exports between countries that form part of the european vat system.
You can start a new business in any eu vat state or country and start importing goods into your own country. You’ll however pay the appropriate customs or excise duties and might need to pay import vat depending on the classification of your goods. However, once your vatvalidation.com taxable sales cross the vat threshold limit set by the particular eu country then you may need vat registration to turn into a vat registered trader or dealer. This will likely clear the path for you to get your own vat no, charge appropriate vat rates in your vat invoice as well as present regular vat returns to your tax authorities. You’ll now truly be a part of your eu vat system.
However, there are many benefits of remaining in the europa vat system. In case you have imported goods from a member vat country where vat has already been charged you’ll be able to simply complete the required vat form to claim a vat refund. Just in case you or your staff have paid vat during trade shows or on any other services that attract vat then such vat rates too can be claimed back from that country provided all documentary proof is shown. As you may not able to learn allin regards to the latest eu vat rules it will be better when you allow a specialist vat agent to reclaim vat on your behalf.
Your vat agent should also file your vat returns in time as well as make sure that your vat refund applications are handled well within the time limit. Most countries in Europe that have adopted vat normally have 3 vat rates. The first is the normal vat rate of about 15 to 25% on most goods. Second is the lower vat rate of about 1 to 6% on specific goods while the third is goods that are vat exempt. If you have paid vat in a foreign country then this is certainly a large amount, and recovering this amount can easily lower costing and provide a much-needed financial injection into your new business.
Vat is truly a powerful way to ensure that tax leakage is reduced in a very seamless manner. You also should go for starting a small business in a very vat friendly european country while also importing goods or services from a member country which also follows vat. By setting up a business inside a eu vat state you are able to certainly retain control of your costs while plugging your revenue leaks on services or goods where vat was already charged.