Starting a new business in a vat enabled European State or country is only going to bear fruit if you confirm all european vat rules before importing goods into that EU State. This move will help you to legally exploit all avenues to make sure that your cost is kept at a minimum and that the issue of double taxation doesn’t eat in your profits.
Several EU countries have embraced vat or vat over the past decade to ensure that trading between such countries proceeds on a common platform. Countries such as the UK, Spain, Greece, Italy, Germany, France, Poland, Netherlands, Sweden, and Hungary, among others have adapted vat and most countries in addition have www.vatvalidation.com moved to a common currency, i.e. the Euro. This move has facilitated smoother trading between these countries and if you want to start a business in an EU country that has changed over to vat then appropriate knowledge of eu vat rules is required for keeping a decent leash on your costs.
Any goods or services which you import into your country will attract customs or excise duties or even import vat, dependant on its classification. To be able to charge vat to the customers, you’ll need to turn into a vat registered dealer, which may be done once you cross the vat threshold in taxable sales. You can now come up with a vat invoice in your country and charge the applicable vat rates to your customers. You will also have to file regular vat returns determined by your sales and purchases.
However, if you are based in any european country that follows vat system and have imported goods to your country where vat was already paid in the original country or have used services in a country where vat has been paid then you can reclaim the vat amount. You can claim vat amount on goods where vat was already paid by applying for a vat refund in the original country. In the event you or your workers have attended trade shows or paid vat on some other services in another country, you’ll be able to still file for a vat reclaim to recuperate the amount of vat paid.
The european vat rates various eu countries range from 15 to 25%, while special vat rates on certain goods and services vary from 1 to 6%. There’s also certain goods that are vat exempt. These rates can easily make a huge difference in your product costs and if you can recover any tax which has previously been paid this can make a positive impact on your business bottom-line. A professional and trusted vat agent can surely help you. You should look for a broker that only takes fees or commissions from vat amounts recovered instead of charging a set fee.
Many countries in Europe have chose a uniform tax system on products or services, which is great news if you plan to start a new business in such a country. Your costing process becomes simpler and you’ll surely be able to recover vat amounts which may have already been charged previously. However, you should surely confirm all european vat rules before importing goods into an EU State in order to defend your fledgling business from any financial shocks.