If you are a vat registered trader in the UK then you would need to pay vat on most goods and services but are you aware that claiming vat back can enhance your business income? If you have already paid vat once on any services or goods necessary for your business or paid vat on it even in another eu country then you can certainly make an application for a vat refund.
Most eu countries now utilize 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. The UK too has moved to vat and when you operate a business in Britain then you will have 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 those 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 claim vat back on any services or goods purchased for your business. This amount can be recovered even if you have paid that vat in another eu country that follows vat, provided you can show documentary proof that includes the vat invoice or vat receipt check this out. In case you have imported goods into 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 to you then these can be claimed back after you fill up the necessary vat reclaim form.
You should hire an excellent vat agent with complete understanding of uk vat and eu vat rules so that your vat refund claim is passed within the shortest time possible. You will have a time limit of 9 months following the end of the year or so after you had first paid your vat on those services or goods. You can use several online vat services offered by hmrc vat including filing online claims for vat refunds. You will need to register on the hmrc website before you fill up the required online vat form for vat reclaim. The form will then be sent to the member eu country in which you may have paid vat initially, along with scans of vat invoices that you might have to attach to the application.
As soon as you get a confirmation usually within 15 days of receipt of the refund claim, it will require around 4 months for the claim to be approved from that member country before you can get your vat back. In the event any other clarification or documents are required then you should expect a delay of 4 more months and therefore it is essential to have it right the first time itself. Your vat refund may be deposited in any bank account which you specify within or outside Britain. However, this amount will be in the currency of the country of origin and will need to be converted into sterling pounds before it can be transferred to your UK banking account.
Even though the process to reclaim vat back is a little tedious, a competent vat agent can apply for vat refunds on your behalf and notify you about the status of your applications. The reality is that claiming vat back can certainly improve your business cash flow by pumping back that double-taxed amount back into your business.