In case you have crossed the threshold limit or wish to be a part of the vat or value added tax system then you will need to make an application for registration for vat to turn into a vat registered trader. When you finally turn into a vat registered trader you will then be empowered to reclaim vat paid in another eu country and thereby lower your costs and also improve your business earnings.
Several eu countries like the UK, Spain, Poland, Sweden, Italy, Germany, etc have moved over to vat for taxing goods and services. Vat is thus followed whilst trading between member eu countries. In case you have started a fresh business www.vatnumbers.com in the UK and also have touched ?70,000 pounds in taxable sales during the past 12 months then you can definitely apply for vat registration with the HM Revenue and Customs or hmrc department. You can even apply before threshold limit is achieved if you sell your services or goods to mostly vat registered traders. Vat registration can be achieved as an individual, partnership, company, trust, etc as deemed fit by the hmrc department.
However, as soon as you make an application for vat registration your costs could increase slightly, and if you sell your goods and services locally in the United Kingdom at the retail level then you could choose to remain outside vat should you only sell vat exempt goods. However, if you try to artificially make an effort to separate your enterprise activities only to remain outside the system of vat then the hmrc vat department may not take your actions lightly if you’re discovered doing precisely the same. There are many advantages of entering the vat system as it will avoid the problem of double taxation by allowing you to reclaim vat already paid on services or goods overseas too.
The entire process for registration for vat is quite simple however, if you aren’t sure about yourself then you should simply appoint a professional vat agent to handle all vat matters. The hmrc vat department offers several vat online services including applications for registration for vat. You can make an application for vat using your vat agent too provided you inform the department of your choice. As soon as you apply for vat registration then the process of approving your application typically takes between 10 to 30 days. Fo the time being you can continue issuing regular invoices to your clients. However, in that period you will need to factor in applicable vat rates and re-issue those invoices issued after the application so that your clients can reclaim vat from other end.
As soon as your application is approved you will receive your unique vat registration number and will have to display it on all vat documents including your vat invoices, vat returns, and vat refunds. You will probably have to issue a vat invoice that separately shows all vat rates applied in that invoice together with your vat no at the very top. You will have to provide a summary of all vat paid and collected within your vat returns which will need to be filed periodically as required by the hmrc vat department. In case you have already paid vat on goods and services in another eu country then you can certainly apply for vat reclaim once you’re a certified vat registered trader.
Vat registration is a simple online process that has to be done first if you want to turn into a vat registered trader in the United Kingdom. You can simply fill the online vat registration form and submit it to the hmrc vat department whenever you apply for registration for vat.