Running a business in Britain that requires importing goods is usually stressful unless you know about vat customs rules imposed by the HM Revenue and Customs department. Learning all about these rules may benefit your organization as you’re able ensure that your purchase and sales deadlines are maintained and your cost is kept to the minimum.
In case you import taxable goods to the UK you will then be charged import vat or customs duties. These duties need to be paid on the value of the goods and are subject to vat rules that form part of the Vat Act of 1994. How much customs duty to generally be paid is known as the ?ad valorem duty? and then there are 6 methods you can use to reach the amount of this duty. You will need to provide documentary proof to hmrc vat department as to why you have chosen vat check a particular method for the valuation of the goods that you have imported to the UK.
If you have imported goods into the UK originating from a eu country which has also collected vat tax from you before the goods were dispatched to the UK then you’ve effectively paid double tax on the same goods. If you’re a vat registered trader in the UK then you can apply for vat reclaim to get the previous amount back to your account. You will need to mention your vat number and give your vat certificate to the country of origin whenever you apply for a vat refund. Although refund process could take between four to eight months to materialize, your costs will definitely get lowered. You should employ the expertise of a competent vat agent that charges fees only on the volume of refunds that you get. This move will give you an incentive for your vat agent while rewarding you with many successful vat refunds.
Once you’ve paid vat customs on the goods and start selling precisely the same under vat invoices then you’ll need to maintain detailed accounts of the level of vat paid and collected on them. You will have to mention these vat amounts in your vat returns which will have to be filed regularly in line with the vat scheme that you have chosen. Remember that that any genuine mistake on your part while importing goods to the UK ought to be rectified as quickly as possible since it may be construed as evasion of customs duties and would invoke strict action including penalties from the hmrc department. Your vat agent should have complete knowledge on customs and excise rules as well as eu vat and uk vat rules so that there are no miscalculations while importing goods to the UK.
If you are a vat registered trader in the UK that must import goods to the UK then you will surely have to pay all applicable customs duties on the same. However, you can also claim back vat amounts paid in the country of origin on goods and also on services that have been utilised in that country. A reliable vat agent can help you decipher vat customs rules and help you get back all excess vat previously paid whilst helping smooth entry of imported goods to the UK.