If you’re a vat registered trader in the UK then you would need to pay vat on many 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 company or paid vat on it even in another eu country then you can certainly submit 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. Great Britain too has moved to vat and if you operate a business in Britain then you will have to apply for vat registration when your last 12 month sales turnover touches ?70,000. As a vat registered trader you will have to pay and collect vat on all purchases and sales in connection with your business depending on the www.vatcontrol.com classification of these products or services as per the HM Revenue and Customs or hmrc vat department.
However, to prevent double taxation on such services and goods, the hmrc department has established vat rules that will permit you to claim vat back on any services or goods purchased for your business. This amount may be recovered even though 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. If you have imported goods to 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 for you then it may be claimed back after you fill the required vat reclaim form.
You need to hire an excellent vat agent with complete knowledge of uk vat and eu vat rules so your vat refund claim is passed within the shortest time possible. You will have a time frame of 9 months following the end of the calendar year once 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 have to register on the hmrc website before you can fill up the required online vat form for vat reclaim. The form is then sent to the member eu country where you may have paid vat initially, along with scans of vat invoices which you may need to affix to your application.
Once you receive a confirmation usually within 15 days of receipt of your refund claim, it will take around 4 months for the claim to be approved from that member country before you can get your vat back. In the event any additional clarification or documents are needed then you definitely should expect a delay of 4 more months and hence it is essential to have it right the very first time itself. Your vat refund may be deposited in a banking account that you specify within or outside the UK. However, this amount will be in the currency of the country of origin and will have to be converted into sterling pounds prior to it being transferred into your UK bank account.
Even though the process to reclaim vat back is a bit tedious, an efficient vat agent can apply for vat refunds on your behalf and inform you on the status of the 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.