If you’re importing goods into the UK from specific parts of the globe then you will have to pay import vat when you import goods from eu special territories as well as from non eu countries. This tax is collected by the hmrc vat department or the hm revenue and customs department on the port or airport itself and also the items are then governed by local sales vat rules.
The hmrc has provided for 14,000 classifications of goods and services which are governed by customs duties, excise duties and import vat. Most alcohol and tobacco products together with certain activities like gambling are governed by excise duties while vatvalidation.com/vat almost every other imports come under customs duties and import vat depending on the goods and also the country from which they arrive.
The hmrc has specified eu special territories where import vat will be levied if services or goods are brought in or delivered to such territories. Those are the French Overseas Departments of Guadeloupe, The Canary Islands in Spain, The Aland Islands in Finland, French Guiana, Mount Athos and Reunion and Martinique in Greece, and also the Channel Islands in the UK. This vat may also be levied whenever you import goods from non eu countries.
However, if you are a vat registered trader in the UK then you can make application for a vat refund in case you have already paid vat on any goods in the nation of origin itself before being imported to the UK. You can also offset this vat against sales vat if the products which you have imported are offered from our UK market. Countries like the UK and Italy offer special vat deferment schemes where one can get respite from import vat for approximately a month by filing out a unique vat form with the hmrc and opening of a special vat deferment account with them. This move would help protect your cash flow.
Once you start selling your services or goods from your market then you will also need to charge any local sales vat rate to the clients. You will have to make vat invoices that specifically mention vat rates as well as file regular vat returns. If you have problem in understanding various duties and taxes imposed by the hmrc then you should hire the services of an excellent vat and customs agent. This will enable you to focus on expanding your enterprise while all relevant paperwork and payment of taxes and duties is handled in an efficient manner.
The import vat rates are exactly like sales vat rates of similar products sold in the United Kingdom. The UK has 3 vat rate slabs. The first is the normal vat rate of 17.5% which is slated to rise to 20% from January 4, 2011. Second is the lower vat rate of 5% while the third is zero vat rate. There’s also certain goods and services that are totally exempt from any vat.
You ought to have sufficient knowledge on various duties and taxes applicable on imported goods into the UK so that you can calculate the costs with an accurate basis. You should use all legal avenues to reduce your costs like vat refunds, vat deferments, etc so that you can reduce your costs further and improve the cash flow of your business. You should diligently pay import vat whenever you import goods from eu special territories or from non eu countries and use the services of an efficient vat agent to claim additional vat back.