If you are a vat registered trader in Britain then you would need to pay vat on most goods and services 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 business or paid vat on it even 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 run a company in Britain then you will need to apply for vat registration when your last Twelve month sales turnover touches ?70,000 check vat number. Being a vat registered trader you will have to pay and collect vat on all purchases and sales related to your company depending on the classification of these 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 established vat rules that will allow you to definitely claim vat back on any goods or services purchased for the business. This amount may be recovered even though 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 web site. If 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 for you then these can be claimed back after you fill the necessary vat reclaim form.
You need to hire a proficient vat agent with complete knowledge of uk vat and eu vat rules so 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 calendar year after 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 need to register at the hmrc website before you fill up the required online vat form for vat reclaim. The form is then sent to the member eu country where you may have paid vat initially, along with scans of vat invoices which you may have to attach to your application.
Once you get a confirmation usually within 15 days of receipt of your refund claim, it will take 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 should expect a delay of four more months and therefore it is vital to have it right the very first time itself. Your vat refund may be deposited in any banking account which 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 converted into sterling pounds prior to it being transferred into your UK bank account.
Although the process to reclaim vat back is a bit tedious, a competent vat agent can apply for vat refunds as your representative and notify you on the status of the applications. The fact is that claiming vat back can certainly improve your business income by pumping back that double-taxed amount directly into your company.